Monday 16 December 2019 12:41 pm

Former Serco directors charged with defrauding Ministry of Justice over tagging contract

The Serious Fraud Office (SFO) has charged two former Serco executives with fraud and false accounting as part of an investigation into the outsourcing giant’s electronic tagging contract.

Nicholas Woods and Simon Marshall have both been charged with fraud by false representation and false accounting in relation to representations made to the Ministry of Justice between 2011 and 2013, the SFO said.

Read more: Serco fined £19m for government tagging contract fraud

Woods has also been charged with false accounting in relation to the 2011 accounts of Serco subsidiary Serco Geografix.

The SFO said it could not comment on the charges as the investigation is still active.

A solicitor for Woods said he “denies the allegations and looks forward to the opportunity of clearing his name.”

“Woods is very disappointed that the SFO has decided to charge him with criminal offences dating back to his work at Serco about 10 years ago,” said Andrew Katzen of Hickman & Rose.

“The SFO has spent six years investigating this matter and Woods fully cooperated throughout,” he added.

Serco was fined £19.2m in July as part of a deferred prosecution deal after it overcharged the Ministry of Justice for an electronic tagging contract.

At the time Serco said it was “mortified” by the case, and said Serco Geografix had taken responsibility for three offences of fraud and two of false accounting.

The outsourcer had already paid the department £70m compensation in a 2013 settlement after it and fellow outsourcer G4S faced allegations of charging for tagging people who were either in jail, dead, or had left the country.

Serco had been understating how profitable its electronic surveillance contract was in its reports back to the Ministry of Justice.

A Serco spokesperson declined to comment on the charges, instead referring back to a statement issued following the July settlement.

Read more: Serco returns to UK growth as outsourcer puts woes behind it

In it, chief executive Rupert Soames said: “Those of us who now run the business are mortified, embarrassed and angry that, in a period between six and nine years ago, Serco understated the level of profitability of its electronic monitoring contract in its reports to the Ministry of Justice.”

“Serco apologised unreservedly at the time, and we do so again.”