Business

I was made a scapegoat, says ex-Tesco director

Carl Rogberg and wife Amanda Image copyright Reuters
Image caption Carl Rogberg, here with wife Amanda, says the four-and-a-half-year ordeal took its toll on his health.

Tesco's former UK finance director feels he was made a scapegoat for the retailer's accounting scandal that wiped £1bn off the company's value.

Carl Rogberg, cleared on Wednesday of fraud and false accounting, claims there was never a black hole in Tesco's accounts.

The case centres on revelations in 2014 that profits were overstated by £250m.

The first trial involving Mr Rogberg and two other defendants was abandoned after he suffered a heart attack.

A second trial, involving Chris Bush, Tesco's former UK boss, and John Scouler, the former commercial director, collapsed last month after the judge at Southwark Crown Court ruled the evidence was too weak to put before the jury.

In his first interview since being cleared, Mr Rogberg told the BBC that he believes there was no black hole in Tesco's accounts in the first place.

Details revealed

"We saw in court that it wasn't £250m, it was a maximum of £118m," he said. "And of that £118m, no fraud has been proven at all. Most of that, in my opinion, is just a different accounting judgement."

What's more, the accounts were "signed off by lots of independent parties". The problem was, he said, that new management came and decided to make "a different accounting judgement".

Image copyright AFP
Image caption Chris Bush (left) and John Scouler (right) had already been acquitted

Mr Rogberg said: "The real story is that this [scandal] was a gateway to start kitchen-sinking by new management."

As he was formally found not guilty, details of a deal agreed between Tesco and the Serious Fraud Office, which looked into the accounting irregularities, were made public.

A deferred prosecution agreement (DPA) allowed Tesco Stores Ltd to avoid prosecution. It paid a £129m fine to settle the case.

The DPA pointed the finger of blame at the three men who subsequently stood trial.

"It's a paradox that on the same day I was acquitted, a document is published that suggests the contrary. I'm seen as guilty, when I'm definitely not".

"There was a rush to judgement. The SFO just took that judgment and adopted it," claims Mr Rogberg.

"The deal between Tesco and the SFO was a convenient way to put an end to the story - for the SFO to claim a sort of victory in achieving a DPA, and for Tesco to say we've moved on and say, well that's the end of it. "

This outcome, he says, raises serious questions about the use of DPAs.

These deals are new territory for the SFO, and there have only been four DPAs to date.

'Dishonest'

For both parties, agreements can be far more attractive compared to a lengthy investigation and potential prosecution where there are risks and costs for both sides.

Media playback is unsupported on your device
Media captionFormer Tesco director Carl Rogberg says there was "never any evidence" of wrongdoing against him

The SFO defended its handling of the case. Director Lisa Osofsky said: "Tesco Stores Limited dishonestly created a false account of its financial position by overstating its profits.

"The DPA clearly outlines the extent of this criminal conduct for which the company has accepted full responsibility."

Tesco insists its decision to enter into the DPA was made after a detailed investigation.

The retailer told the BBC: "The overstatement of expected profit was independently investigated and verified by [auditors] Deloitte.

"Following an investigation which lasted over two years, Tesco Stores entered into a DPA with the SFO. This DPA was also separately approved by a senior High Court Judge as being in the interests of justice."

Tesco added that it never comments on any of its existing or former colleagues.

'Taking stock'

For Mr Rogberg, the last four years have taken their toll. The 52-year-old says the stress contributed to his heart attack.

"It wasn't only from the trial, but also the stress of being in this situation. You have this big black cloud hanging over you," he says.

Mr Rogberg learned of the looming crisis when he was called to Tesco HQ on the evening before the company informed the stock market about its profits misstatement.

"I was convinced it was just a mistake; somebody had made a mistake and the company was following a protocol and I respected that protocol, so I thought it would just be over in a couple of days.

But it slowly "crept up on me... that I was implicated in a bad way," he said.

He's not sure what his next steps will be, and whether he'll consider legal action of his own.

"At the moment I'm just celebrating. I will take stock and see what I'm going to do. Four-and-a-half years has been a long time to be in a legal situation."

More on this story