The SFO opens a criminal investigation into electronic tagging by G4S and Serco, after it was revealed that the government was charged for the tagging of criminals who were dead or in jail.
In July, the government placed all contracts held by G4S and Serco on hold after an audit revealed it had been billed for tagging people who had in some cases left the country, were in prison, had never been tagged, and in some cases, were dead.
A furious Justice Secretary Chris Grayling at the time launched a review of the largest government contracts with the two businesses – including eight G4S contracts valued at £250m and nine Serco contracts valued at £750m.
The director of the Serious Fraud Office has opened a criminal investigation into G4S and Serco electronic monitoring contracts. Serious Fraud Office
In an announcement to the stock exchange on Monday, G4S said: “G4S confirms that it has today received notice that the director of the Serious Fraud Office has opened an investigation into the ‘contract for the provision of electronic monitoring services which commenced in April 2005 as amended and extended until the present day’.”
G4S said it would “co-operate fully” with the investigation.
The SFO also confirmed the investigation, saying: “The director of the Serious Fraud Office has opened a criminal investigation into G4S and Serco electronic monitoring contracts.”
Home Affairs Correspodent Simon Israel's blog: 'Extraordinary and disturbing' - the G4S tagging malfunction
The action follows the government audit, which was initiated in May. In July the government asked G4S and Serco to undertake additional audits – G4S declined and the government refered it to the SFO.
Serco did undergo the additional audit. In the course of the audit in September, the Ministry of Justice provided material to the SFO in relation to Serco’s conduct.
Shares in G4S fell by around 2 per cent, and shares in Serco fell by 0.54 per cent, in opening trading on the London Stock Exchange on Monday.