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The BBC this morning reports that Tesco has been notified by the UK's Financial Conduct Authority (FCA) that it is under investigation after its admission that the company's first half profit projections had been overstated by the equivalent of more than $400 million (US) because of what the company acknowledged was "early booking of revenue and delayed recognition of costs."

While the company has not said whether the misstatements were the result of fraud, incompetence or a mistake, four company employees - including Chris Bush, who has been running Tesco's UK business - have been suspended, though not disciplined, pending the results of an internal investigation.

The BBC also writes that "the chairman of the Parliamentary Business Committee, Adrian Bailey, has described Tesco's error as 'stratospheric,'" and has said that recently deposed CEP Philip Clarke could be called to appear before his committee.
KC's View:

It would seem to be a pretty good bet that a lot of past and present Tesco executives could find themselves marched before a whole bunch of committees, especially if it starts to look like the company has been a fraud, in every sense of that word. And I'd still like to see the CEO who preceded Clarke, Terry Leahy, compelled to ask a few questions on the record…