■ SERCO EXECUTIVES ACCUSED OF HIDING £12M PROFITS
TWO former Serco bosses, accused of defrauding the Ministry of Justice over the private security firm’s electronic tagging contract, concealed £12million in profits, a court heard.
Simon Marshall, 59, and Nicholas Woods, 51, allegedly encouraged a man, who cannot be named, to submit fictional costs to the MoJ from 2011 to 2013.
Prosecutor Michael Bowes, QC, said Woods, the former finance director of Serco Home Affairs, and Marshall, the former operations director of field services, defrauded ‘the MoJ treasury – so ultimately the taxpayer’.
He said: ‘ The false representation is that costs were made up in order to conceal Serco’s high profit margin and so stop the MoJ from taking steps from recovering any of Serco’s profits or otherwise reduce the revenue stream.’
Jurors heard costs were falsely repeated on behalf of Serco, reducing the company’s true profits from £27million to £15million. Woods and Marshall allegedly falsified expenses to subsidiary Serco Geographix Ltd, only to reclaim the money later, Southwark crown court heard.
Mr Bowes said the pair encouraged their co-conspirator to declare costs to the MoJ that never actually occurred. As part of the contract, Serco had to submit a regular financial report on the project to the ministry, the court heard. ‘The prosecution’s case is that the submitted costs were not true and accurate and so were false, misleading and fictitious,’ Mr Bowes said. Marshall, of Ascot, Berkshire, and Woods, of Ickford, Buckinghamshire, deny fraud by false representation. Marshall also denies two further counts of fraud by false representation. The trial continues.