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A jury has been sworn in and the opening arguments are set to begin in the trial of three former executives of supermarket giant Tesco over the £326 million accounting scandal between the period of February and September 2014.
The three former executives are Christopher Bush, Carl Rogberg and John Scouler and have been charged with fraud by abuse of position and false accounting, Rogberg was a former UK finance director, and Scouler was once UK food commercial director. All three have pleaded not guilty.
Earlier this week, the three defendants confirmed their names before the start of their trial at Southwark Crown Court.
The case dates back to September 22, 2014 when the 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 250 million pound ($338 million) over-statement of its expected profit for the half year.
In the biggest crisis in Tesco’s 100-year history, the three accused had allegedly failed to check the inflated income figures of the supermarket, which were published to auditors, ad other stakeholders.
The profit over-statement was reportedly identified three weeks after Dave Lewis took over as Tesco chief executive from Phil Clarke, who was later fired due to the poor performance of the supermarket group.
Earlier this year, Tesco agreed to pay a fine of £129m to settle a probe into this scandal. “The SFO’s (Serious Fraud Office) investigation into Tesco concluded in April 2017, when we entered into a Deferred Prosecution Agreement. Over the last three years, we have fundamentally transformed our business,” a statement from Tesco stated.
Dave Lewis, the chief executive of Tesco, also said that the settlement allowed the company to move on: “I want to apologise to all those affected. What happened is a huge source of regret to us all at Tesco, but we are a different business now.”
Lewis admitted the Tesco brand had been damaged by the disclosure of the accounting scandal, but said the company was “committed to doing everything we can to continue to restore trust in our business and brand”.