The consultancy has been making the wrong kind of headlines in the US since brokering a £240,000 deal between the Department of Health and prominent black commentator Armstrong Williams to promote Bush's No Child Left Behind Act.
Williams' PR and ad production firm was hired to produce advertising featuring education secretary Rod Paige, and mention the act in his TV shows and newspaper columns. But Williams forgot to mention in his coverage that he was effectively on the government payroll - a fact uncovered by USA Today.
Predictably, Ketchum found itself in the firing line, with questions over the legality of the contract in view of Congress's ban on 'propaganda'.
It has denied it acted inappropriately and Williams says the failure to disclose was his responsibility. But with more cases emerging - newspaper columnist Michael McManus and conservative columnist Maggie Gallagher being paid to support Bush's marriage initiative - the issue has significant implications.
The use of opinion-former endorsement in the UK is regarded with suspicion by government and public alike. Add a substantial fee and an expert who straddles the divide between journalism and PR/advertising and you've got trouble.
So should a PR firm be held responsible? That the PRSA and The Council of Public Relations Firms have given inconsistent views proves what a grey area this is. Ketchum should have known better, having only recently been caught up in a row over VNRs promoting a new Medicare law, which weren't identified as government productions.
Ketchum accepts the choice of pundit was also not a wise one, and one that blurred the roles between commentators and spokespeople. But as Ray Kotcher wrote in last week's PRWeek US, increasing media convergence is creating a complex environment with blurred lines.
So the moral? While this is a serious issue for journalists, the PR agency will always come under scrutiny. So play it safe, particularly if dealing with government contracts. Make it a contractual obligation that a sub-contractor of third-party endorsement discloses financial interests, put in place monitoring systems that ensure they do, and try and think like the most cynical reporter when choosing your 'expert'. Hindsight is a wonderful thing.