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Friday, October 25, 2013

Serco chief executive stands down after scandal


Serco chief executive stands down after scandal

The chief executive at Serco, a security firm at the centre of an overcharging scandal, has resigned.
Outgoing boss Chris Hyman said the best way for the company to move forward "is for me to step back".
Serco is being investigated by the Serious Fraud Office (SFO) after claims it had overcharged the government by "tens of millions" of pounds for electronic tags for criminals.

A Serco flag flying alongside a Union FlagSerco's chief executive said he had always put the interests of the company first
The government welcomed the news, describing it as a "positive move".
In July, Justice Secretary Justice Secretary Chris Grayling said an audit had revealed a "significant anomaly in the billing practices" of both Serco and G4S.
Mr Grayling said that since 2005, the companies had in some cases been charging for tagging offenders who were in prison, had left the country or were even dead.
In September, the government handed information to the SFO for their assessment.
Closer monitoring
On Friday, Serco announced plans to reorganise the company.
The firm said it would split the government work into a separate business that could be more closely monitored.
A government statement said it would "take full account of all the changes Serco have made today".
"Whilst it is early days in their programme of renewal, this is a positive move by Serco and a step forward."

Serco Group

LAST UPDATED AT 25 OCT 2013, 12:53 GMT*CHART SHOWS LOCAL TIMESerco Group intraday chart
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The statement added that its review of government contracts, announced in July by the Justice Secretary, was continuing and would "ensure government's contractual arrangements are robust and taxpayers' money is spent responsibly, in a vibrant, competitive market for public services".
Shares in Serco were up 2.8% after the news.
Mr Hyman said he had "always put the interests of Serco first", adding that it was important the relationship with the government was rebuilt.
He said: "I have been fortunate enough to have had the privilege of working at a great company with extremely talented people. I wish everyone at Serco the very best for the future."
No new contracts are being awarded to either of the firms until the audit is completed, the government said in September.
The head of G4S, Richard Morris, stepped down on Thursday.