Tesco suspends three more senior staff over profits scandal

Tesco

Tesco has suspended three more senior employees as part of its ongoing investigation into a £250m accounting scandal.

“We have asked three employees to step aside to facilitate the investigation into the potential overstatement of profits in UK food for the first half of the year,” the company said in a statement.

Tesco declined to name the employees but they are understood to be category directors in charge of procuring whole sections of goods for Tesco stores.

Sky News is reporting them to be Dan Jago, Tesco’s UK and group wine director, Sean McCurley, director of convenience foods, and William Linnane, director of impulse purchases. Their Twitter and LinkedIn accounts were deactivated on Tuesday.

Tesco has said it would update the market and authorities on its investigation at its interim results on 23 October. The City regulator, the Financial Conduct Authority, is conducting an investigation into the issue.

Dave Lewis, Tesco’s new boss, has already asked four senior executives to step aside and Tuesday’s suspensions take the total to seven.

Those already suspended are Chris Bush, managing director UK; Carl Rogberg, UK finance director; John Scouler, food commercial director; Matt Simister, who is responsible for sourcing; and Kevin Grace, commercial director.

Earlier this week Tesco’s company secretary, Jonathan Lloyd, said he would leave the retailer next March after serving his notice period. Audit committee chairman and non-executive director Ken Hanna is also expected to stand down when his six-year term ends later this year.

Tesco beefed up its board last week with the appointment of a former Ikea chief, Mikael Ohlsson, and the Compass CEO, Richard Cousins, as non-executive directors.

The accounting scandal, which is being investigated by Deloitte and the law firm Freshfields, has knocked more than a fifth off Tesco’s share price since it was first reported on 22 September, when the company admitted it had overstated its first-half profits forecast by £250m.

The statement came three weeks after a trading update that predicted first-half profit would be £1.1bn, down from £1.6bn a year earlier.

Powered by Guardian.co.ukThis article was written by Rupert Neate, for The Guardian on Tuesday 14th October 2014 13.24 Europe/London

guardian.co.uk © Guardian News and Media Limited 2010

 

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