Tesco faces US lawsuits over profit scandal
A GROUP of angry shareholders are launching a lawsuit against Tesco and seeking billions of pounds in compensation over last year’s accounting scandal that led to a huge black hole in profits.
Tesco has suffered one of the most turbulent years in its history following revelations at the end of last year it overstated profits by £263m, driving its share price down to a 14 year low and prompting a series of investigations by the Serious Fraud Office among others.
Tesco Shareholder Claims, a non-for-profit group funded by US law firm Scott + Scott, said yesterday it would seek to bring an action against Tesco on behalf of UK and European institutions, arguing the profit overstatement “caused a permanent destruction of value to shareholders”.
Scott + Scott has already brought an action against Tesco in US and is now trying to drum up support from institutional shareholders in Europe for a potential claim.
Tesco declined to comment. The law suit comes as a further blow for chief executive Dave Lewis and new chairman John Allan, who are seeking to turn the business around and put last year’s scandal behind it.