The Tesco accounting scandal sent shock waves through the British financial community when it was revealed in October 2014. Those shock waves made it to Britain’s former colonies here in America as even The Man From FCPA sat up and took notice. The venerable British grocery chain admitted it had overstated earnings for the first half of 2014 by around £260m by fraudulently accounting certain revenues received back from suppliers. According to an article in the International Business Times, “The impact of the probe, and subsequent internal investigations and accounting writedowns, led to Tesco reporting its biggest loss on record of £6.4bn for the year to February 2015.”

Now the U.K. Serious Fraud Office (SFO) has announced the first three indictments from the scandal. Earlier this month the SFO said in a Press Release it was charging three individuals, Carl Rogberg, Christopher Bush, and John Scouler, each with one count of fraud which allegedly occurred between February 2014 and September 2014.The three men are scheduled to appear at Westminster Magistrates’ Court on Sept. 22, 2016. Each is facing up to ten years in prison if convicted.

According to an article in The Telegraph, the allegations of fraud were brought forward to Tesco management by an internal whistleblower and were made only 22 days into the tenure of new CEO Dave Lewis. The allegations were confirmed by Deloitte and the company reported the findings to the SFO. The same article noted that there may be additional criminal charges brought against some of the individuals involved and if there is a corporate resolution secured, through a Deferred Prosecution, the penalties could run as high as £500 million.

With the conversation in the United States about the (lack of) prosecutions of individuals in the wake of the Yates Memo, it will be most interesting to see how the SFO proceeds in this matter and if they will proceed higher up the chain at Tesco to prosecute individuals.

Continue the conversation at Compliance Week Europe: 7-8 November at the Crowne Plaza Brussels. Join us as we look at changes in global anti-corruption regulations, slave labor risks in your supply chain, and how to detect fraud, to name just a few topics. Learn more