Tesco’s British Unit Is Set to Avoid Criminal Charges in Accounting Scandal -
By CHAD BRAYMARCH 28, 2017
LONDON — The British supermarket giant Tesco said on Tuesday
that its domestic business had reached an agreement in principle to avoid criminal charges in an accounting scandal that rocked the company nearly three years ago.
On Tuesday, the fraud office said that the deferred prosecution agreement related only to potential criminal liability by the British unit
and did not address whether liability of any sort would attach to Tesco itself, or any employee or agent of the company.
Tesco said that its British arm, Tesco Stores Limited, would enter a so-called deferred prosecution agreement with the Serious Fraud Office, Britain’s anticorruption watchdog,
and pay a penalty of 129 million pounds, or about $162 million.
In its inquiry, the Financial Conduct Authority said
that it had found that Tesco put out a misleading statement in August 2014 about its expected profit in the first half of the year and relied on information provided to it by Tesco Stores Limited in doing so.
That agreement is subject to final approval at a court hearing next month
and is related to false accounting statements from February 2014 to September 2014.
On Tuesday, the company also said that it had agreed to pay an estimated £85 million, plus interest, to
compensate investors after a related inquiry by another regulator, the Financial Conduct Authority.
