The matter is related to the possible misuse of company assets, according to the Wall Street Journal, which cited unnamed sources.
WPP the global advertising and marketing partner to some of the world's biggest consumer electronics and appliance brands, is investigating their CEO Martin Sorrell who has been accused of "personal misconduct" at the same time USA authorities are running a separate investigation. "The allegations do not involve amounts which are material to WPP", the statement said.
Martin Sorrell CEO of WPP attends the World Economic Forum (WEF) annual meeting in Davos, Switzerland January 17, 2017.
We wait to see how WPP's shares react to the overnight news.
However, WPP's chief has rejected the allegation of financial impropriety against him.
Reacting to the statements, Sorrell said in a statement, "I reject the allegation unreservedly but recognise that the company has to investigate it".
A statement from the company said: "The investigation is ongoing".
Sorrell, who denies any wrongdoing, transformed WPP from a wire shopping basket maker through acquisitions of top creative agencies including J. Walter Thompson and Young & Rubicam, as well as media planners and buyers and market-research and public-relations groups. From here, he built the advertising empire that now boasts 3,000 offices in 112 countries.
Senior management at WPP haven't been given details of the allegations, according to one executive who declined to be identified discussing internal matters, saying staff were shocked by the revelations.
The firm's long-time CEO made £70 million ($98 million) in 2015 and £48 million ($68 million) a year ago. He was knighted in 2000.
WPP shares have fallen by 36 percent in the a year ago after consumer goods clients such as Unilever (NYSE: UL - news) cut ad spending, while digital companies Google and Facebook (Swiss: FB-USD.SW - news) have encroached on its turf by forming direct relationships with brands.
Last year, he led WPP to its worst financial performance since the 2009 global meltdown.
He responded to the allegation in comments reported by the BBC.