Large investors sue Tesco over losses in accounting scandal
Tesco is facing legal action from a group of 125 large investors who claim to have lost "well in excess of £100 million" as a result of the supermarket's accounting scandal two years ago.
Bentham Europe, the firm fronting the action, said that institutional funds have filed the lawsuit in a bid to prove that Tesco "made misleading statements to the stock market that omitted material information and which were relied on by investors when making investment decisions".
Tesco suspended eight directors and was investigated by the Financial Conduct Authority (FCA) and the Serious Fraud Office (SFO) after it was found to have inflated profits by £236 million in 2014. The figure was later revised up to £326 million.
Jeremy Marshall, chief investment officer of Bentham Europe, said: "The misstatement of profits leading to a dramatic collapse in the Tesco share price caused substantial damage to many shareholders who manage money for thousands of investors.
"Investors have a right to rely on statements made by companies to ensure that they correctly allocate capital. The claim will assert that Tesco's misstatements are in clear breach of its obligations under the Financial Services & Markets Act and investors must be compensated."
The SFO has charged three former Tesco executives over the accounting scandal, alleging that Carl Rogberg, Chris Bush and John Scouler - the supermarket's former finance chief, managing director and food commercial head - failed to correct inaccurately inflated income figures for the supermarket.
The trio are expected to appear in court on May 30 for a plea hearing.