GroupM has sacked an executive in China who it says has been "detained on charges of bribery".
WPP's media agency group says it is cooperating with the authorities and conducting its own investigation with an independent third party.
GroupM made a statement following reports of a police raid on its offices in Shanghai and the detention of one current, and three former, employees.
"We cannot comment on the details of an active police investigation," GroupM says in a statement from London.
"However, we are terminating the executive’s employment with the company, and GroupM is suspending trade with any external organisation we understand to be part of the police enquiries.
"We are absolutely committed to behaving in accordance with the law and our own code of conduct, and will take all necessary action to ensure this is the case within our business."
The Financial Times quoted a statement from the Shanghai Public Security Bureau’s Economic Crime Investigation Department.
The bureau said it had “cracked” a commercial bribery case involving an advertising company, but did not name the agency.
China is an important, and growing, market for WPP, recently recovering from a trough to post growth of 4.8% in the September quarter..
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