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By
Reuters
Published
Oct 1, 2014
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Tesco whistleblower's warnings were initially ignored

By
Reuters
Published
Oct 1, 2014

LONDON, United Kingdom - Initial warnings from the insider who blew the whistle on a 250 million pounds ($406 million) accounting scandal at Britain's biggest retailer Tesco were ignored, the Sunday Times reported, citing a senior source at the supermarket.

The newspaper reported that the concerns were first raised before former Chief Executive Philip Clarke left the supermarkets group in July following a profit warning.

The whistleblower, an accountant reporting to UK finance director Carl Rogberg, raised concerns with superiors but "failed to get traction", the newspaper reported.

Clarke's ousting and the appointment of former Unilever executive Dave Lewis as his successor on Sept. 1 encouraged the insider to pass the information to Tesco's general counsel, who alerted Lewis to the problem nine days ago, the Sunday Times reported.

Tesco declined to comment on the report.

On Monday, Tesco said it had overstated first-half profit by 250 million pounds - effectively its third profit warning in two months. It suspended four senior executives and launched an investigation, calling in forensic accountants and lawyers.

The Sunday Telegraph reported that the Tesco investigation is focusing on the culture of the retailer, with concerns that managers may have been pressured into using improper practices.

The Mail on Sunday reported staff had been ordered not to shred or delete documents while an investigation into the scandal takes place.

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