Deloitte fined £6.5m over role in Serco tagging scandal
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16:45 23/04/24
Deloitte has been fined £6.5m for misconduct over its role in the Serco electronic tagging scandal by the accounting industry watchdog.
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The Financial Reporting Council (FRC) on Thursday severely reprimanded both Deloitte and audit engagement partner Helen George, saying they “failed to act in accordance with the Fundamental Principle of Professional Competence and Due Care”.
The fines relate to audits of Serco Geografix in 2011 and 2012.
Serco on Wednesday was hit with £23m in fines and costs after it cut a deal with the Serious Fraud Office and admitted three offences of fraud and two of false accounting between 2010 and 2013.
The outsourcer had overstated profits on a contract with UK’s Ministry of Justice to tag criminals. It emerged that Serco had been billing for offenders who were out of the country, or in some cases, dead.
Deloitte was fined £6.5m and George £150,000, discounted to £4.2m and £97,500 respectively under a deal with the FRC. The accountant will also pay £300,0000 towards the costs of the investigation.
The FRC added that the settlement agreement and particulars of the case would not be published at this time.