By Charlotte Webster-
Tesco’s payment of £129m in fines is so suspicious, we must shake our heads in disbelief that the prosecution lodged by the SFO failed so spectacularly.
Carl Rogberg’s official acquittal today has raised many questions about the doomed SFO prosecution case in which his former colleagues Christopher Bush, 53, and John Scouler, 50, were cleared of fraud and false accounting in December. The December ruling of the trial judge Sir John Royce that the prosecution case was too weak to be allowed to proceed was topped up by the Rogberg’s acquittal today. In a sense, the victory was one of default. Insufficient evidence is always the default position of the courts when a guilty party walks free.
Technically, all parties in the case on the part of Tesco are innocent. The court ruling says so. However, the fact Tesco paid a mammoth sum of £129m to settle the case suggests guilt in every way. It is serious contradiction of logic that any company or organisation would pay £129m in fines for an offence they did not commit.
Carl Rogberg, 52, a former UK finance director at Tesco, was one of three former executives at the chain to face a criminal trial for their alleged role in the accounting scandal. Just weeks after chief executive Dave Lewis had taken charge, Tesco revealed it had over inflated its profits by £250m, causing £2bn to be wiped off its share price.
Sasha Wass QC, defending the SFO, told Southwark Crown Court that the agency offered no evidence in the case. Rogberg had every reason to deny one charge of fraud and one charge of false accounting because he knew there was no evidence. No evidence, yet Tesco Stores Ltd paid £129m in fines, as part of a Deferred Prosecution Agreement. Common sense tells us that no company would pay such a sum if they had nothing to be concerned about.
The DPA identifies the three executives — even though they have been acquitted by the criminal courts. The agency had claimed in both trials that the men, who always denied wrongdoing, were aware that income was incorrectly being included in financial records to meet targets and make Tesco look healthier than it was.
It alleged the men, whom it dubbed the “generals”, knew income had been “pulled forward” in one financial period when it should have properly been booked in another, and resorted to “conniving and manipulating” figures by incorrectly encouraging others to pull forward income.
The fact Tesco failed to investigate the SFO’s claim in the second trial that 400-600 buyers who negotiate deals with supermarket suppliers had been involved in falsifying records and improperly recording income should worry any observer of the case.
Relieved: Carl Rogberg Image: news.sky.com
RELIEF
Mr Rogberg’s expression of “huge relief” is normal given the inevitable concern an allegation this big would have on anybody in his shoes. His strongest point of defence was the lack of evidence. Rogberg says his former employer ”rushed into the wrong judgement” “Tesco needlessly paid over £129m in fines, not to mention the value that was lost in the company as a result of this fiasco,” Rogberg said. The payment wasn’t needless from Tesco’s point, it was necessary. That is the only reason they paid an amount that equates a mega prize on a Euro National lottery jackpot.
In fact, the relief all three of the defendants and Tesco chiefs must be feeling is understated. They must feel like on top of the world, with their profiles now raised after a case that leaves them so clean, yet so suspicious.