Tesco facing criminal fraud inquiry

A probe for Tesco found a serious accounting error concerning profit expectations. Picture: PA
A probe for Tesco found a serious accounting error concerning profit expectations. Picture: PA
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TESCO has formally been placed under criminal investigation by the Serious Fraud Office (SFO) following its discovery of a £263 million hole in profit expectations.

The group said that in light of the SFO probe, a separate investigation by the Financial Conduct Authority (FCA) has been closed.

It comes after a probe for Tesco by accountants Deloitte and law firm Freshfields found the accounting error was worse than first thought and that the supermarket had been overstating its earnings for years.

In a statement, the group said: “Tesco confirms that it has been notified by the Serious Fraud Office that it has commenced an investigation into accounting practices at the company.

“Tesco has been co-operating fully with the SFO and will continue to do so.

“Tesco has been notified by the Financial Conduct Authority that, in light of the SFO investigation, its investigation will be discontinued.”

The SFO confirmed that its director David Green QC “has opened a criminal investigation into accounting practices at Tesco plc”.

It said that as the investigation was under way it could not provide further details.

The SFO is responsible for investigating and prosecuting serious and complex fraud and corruption.

The FCA confirmed that it had “decided to discontinue its own investigation with immediate effect”.

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