Home Business NewsBusiness Former Tesco bosses 'massaged' profits to mislead stock market, court told

Former Tesco bosses 'massaged' profits to mislead stock market, court told

29th Sep 17 4:56 pm

Trial in accounting fraud case continues

Three former executives of Tesco “massaged” the British supermarket’s expected profits by £250m and then “bullied and coerced” employees to mislead the stock market, a criminal court has heard today.

Earlier this week, a jury had been sworn in the trial of three former directors of Tesco who are accused in a £326m accounting scandal between the period of February and September 2014.

The three — Christopher Bush, Carl Rogberg and John Scouler — have all been charged with one count of fraud by abuse of position and one count of false accounting. All have pleaded not guilty.

The three men appeared before the Southwark crown court today where The Serious Fraud Office (SFO) lawyer Sasha Wass QC told the jury: “The three defendants on trial are not the foot soldiers. The defendants in this case are the generals in a position of trust and had huge compensation packages to safeguard the financial health of Tesco.”

Wass further said that the three men “encouraged the manipulation of profits” and “bullied and coerced” those under them to falsify figures so that income was recorded when it should not have been.

Wass also told the jury that even the auditors of the supermarket, PwC, were “misled and lied to”.

It was also reported in the court that the three men received a considerable amount of remuneration in Tesco shares —   Rogberg received over £1m, Bush nearly £3m and Scouler £1.5m —  and therefore had a personal interest in keeping the share prices up.

All three men could face up to 10 years in prison if found guilty of fraud and seven years for false accounting.

The case dates back to September 22, 2014 when the retail giant had issued a statement to the London Stock Exchange stating that during its final preparations for an interim results announcement it had identified a 250m pound ($338m) over-statement of its expected profit for the half year. This was the biggest crisis to hit Tesco in its 100-year history.

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