For the second day in a row Wednesday, RCMP officers staged raids in connection with their investigation of an advertising agency at the centre of a federal sponsorship scandal.

Officers with the commercial crimes section raided a warehouse in Longueuil, just south of Montreal, and a Montreal-area bank branch in search of documents related to Groupaction, said Const. Sylvain L'Heureux.

Police are investigating $1.6 million paid by taxpayers for three controversial reports.

The Groupaction reports helped plunge Prime Minister Jean Chretien's government into scandal this year when it was revealed two of the reports were almost identical and the third was missing altogether from federal files.

On Tuesday, about a dozen officers raided Groupaction's Montreal office and seized documents.

"During the search we found different things that led us to do two other searches today (Wednesday)," L'Heureux said. "One was in a warehouse where some documents were kept and another one in a bank, in a safety deposit box."

The warehouse, which included storage lockers, likely contained cases of documents, he said.

L'Heureux would not elaborate on what was found, saying the warrants for the searches are sealed and cannot be made public.

"The investigation is still ongoing," he said.

About six or seven officers took part in Wednesday's searches.

The RCMP is seeking evidence for its investigation that could be handed to federal prosecutors.

Meanwhile, the Globe and Mail reported Thursday that the former head of Ottawa's sponsorship program wrote to Groupaction saying the company did not have to return federal funds destined for specific events if the shows were cancelled.

"If a show is cancelled for any reason whatsoever, could you please ensure that the visibility given to that event be redirected to another event to ensure that the Canadian government fully benefits from its investment?" said the letter from then-bureaucrat Chuck Guit to Groupaction president Jean Brault.

A Quebec City hunting-and-fishing show that was to be overseen by Groupaction was cancelled eight months after the June 1999, letter was sent.

Groupaction and the organizers of the show, Le Groupe Polygone Editeurs Inc., kept $383,000 in sponsorship funds that they had received.

It is unclear whether the two companies followed the request in the letter to use the money to put up additional federal advertising elsewhere. The now-retired Guit wrote that to do so would be to ensure that Ottawa received its money's worth, the Globe reported.

On Tuesday, investigators in Montreal spent a full day picking through computers and documents at Groupaction.

They carted out seven boxes of documents late Tuesday, including some reportedly marked "time sheets" and "former employees."

Brault said last month most of the federal money was spent to provide "ongoing counselling" related to federal advertising and event sponsorships in Quebec.

Brault also denied that there was any link between his company's generosity to the federal Liberals and Groupaction receiving the lion's share of the $40 million in annual federal sponsorship deals.

Under attack, the government called in federal Auditor General Sheila Fraser to conduct an independent review. She said federal contracting officials "broke every rule in the book" and took the unusual step of calling in the Mounties.

A parliamentary report expected to be critical of the government's handling of three advertising contracts that was due out this fall may never be revealed following Chretien's decision to prorogue Parliament and begin a new session later this month.

Government officials could not guarantee this week that the report on the government's mishandling of Public Works contracts will ever be made public.