Tesco executives ‘made staff cook books in scam to inflate pay’

THREE senior Tesco executives bullied staff to “cook the books” in a scam to boost their million pound incomes leading to £2billion being wiped off the supermarket’s value, a court has heard.

Carl Rogberg, 50, Chris Bush, 51, and John Scouler, 49, are accused of falsifying profits to boost their own incomes in a scandal which sent “shock waves” through the stock market.

The supermarket made a public announcement to the stock market on September 22 2014 which stated that it had previously over-estimated its profits by £250million, Southwark Crown Court heard yesterday.

It led to its shares falling by 12 per cent, wiping £2 billion off its total share value. Tesco’s former finance chief, managing director and food commercial head are charged with fraud by abuse of position and false accounting between Feb and Sept 2014.

Sasha Wass QC said: “The prosecution case in a nutshell is that all three defendants were aware that income was being wrongly included in the financial records of the company, which were used to inform the stock market.

“Each of the defendants was aware that this would lead to the company looking financially healthier than it actually was and it would result in Tesco’s trading profits being overstated. Ms Wass said the case amounted to “cooking the books or what lawyers call false accounting”. She said employees in “relatively subordinate positions” had been involved in presenting the false figures.

“The defendants in this case are the generals – those who are in positions of trust and who were paid huge compensation packages in order to safeguard the financial health of Tesco,” she said.

“Each of these three defendants used their managerial authority and actively encouraged those working beneath them to falsify the figures and, when those subordinate employees objected, the subordinate employees were bullied or coerced into carrying on with this practice,” Ms Wass added.

The court heard that Mr Rogberg, who was “directly responsible” for authorising the falsified figures, received a remuneration package of more than £1million in 2014.

Mr Bush, who was in charge of the performance and “integrity” of Tesco at the time, received nearly £3million, and Mr Scouler, who allegedly directed those beneath him to falsify income figures, received around £1.5million.

She told the jury about the practice of “pulling forward”, which she said was “Tesco shorthand” for bringing forward income from the future to artificially inflate the figures of the present. Mr Rogberg, of Chiselhampton, Oxon, Mr Bush, of High Wycombe, Bucks, and Mr Scouler, of St Albans, Herts, all deny the charges. The trial continues.