Serco: Police To Probe Prison Firm Over 'Fraud'

Security firm Serco faces a police fraud investigation over its £285m prison escorting contract.

Serco staff allegedly recorded prisoners as having been delivered ready for court - a key performance measure - when in fact they were not, the Ministry of Justice (MoJ) said.

The contract, which covers prison transfer services in London and East Anglia, has been put under administrative supervision with immediate effect.

Justice Secretary Chris Grayling said: "It's become very clear there has been a culture within parts of Serco that has been totally unacceptable, and actions which need to be investigated by the police.

"We have not seen evidence of systemic malpractice up to board level, but we have been clear with the company - unless it undertakes a rapid process of major change, and becomes completely open with Government about the work it is doing for us, then it will not win public contracts in future.

"The taxpayer must know that their money is being properly used."

Both the MoJ and Serco's directors have asked City of London police to investigate the actions of the staff working on the prison escorting contract. 

Evidence of potentially fraudulent behaviour emerged as part of the audit work announced by Mr Grayling in July.

The audit work came in the wake of an electronic tagging scandal, in which G4S and Serco were both accused of overcharging the Government for monitoring offenders.

In light of the new findings, Serco have agreed to repay all past profits made on the prison escorting contract and to forgo any future profits.

The FTSE 100 giant has told the MoJ that no member of the board had knowledge of the allegedly fraudulent practice.

Chris Hyman, chief executive of Serco Group, said: "The Justice Secretary is right to expect the highest standards of performance from Serco.

"I am deeply saddened and appalled at the misreporting of data by a small number of employees on the contract.

"This is a very serious matter for the customer and for us. We will not tolerate any wrongdoing and that is why we have referred this matter to the police."

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4G Mobile Goes Live On Vodafone And O2

Mobile networks Vodafone and 02 have flicked the switch on faster 4G data services.

O2's service will go live in London, Leeds and Bradford, reaching up to five million people initially, while Vodafone's offering will roll out in parts of the capital.

Both networks plan to have coverage in 13 cities by the end of the year - London, Birmingham, Bradford, Coventry, Edinburgh, Glasgow, Leeds, Leicester, Liverpool, Manchester, Newcastle, Nottingham and Sheffield.

They plan to eventually offer 4G to 98% of the UK.

Rival network EE stole a march on its rivals by launching its own service in October last year and already serves 100 towns and cities.

Samsung's Galaxy S4 and Apple's iPhone 5 are among the 4G-enabled phones

It had signed up 687,000 4G customers by the end of June.

4G networks can provide data to smartphones around five to six times faster than 3G connections, according to the networks, speeding up internet browsing and making it ideal for downloading and streaming high quality video and music.

Vodafone spent £802m in Ofcom's 4G auction in February, while O2 spent £550m to buy a portion of the lowest frequency spectrum.

O2 and Vodafone are trying to tempt customers by including music and sports content in their 4G packages.

However, the faster services currently cost more than existing 3G.

EE launched 4G last year and says it is on course for a million subscribers

The relatively small data allowance of some 4G packages can also easily be used up when downloading video for example.

Many customers also appear unconvinced of the benefits.

Despite being aware of the new services, recent Ofcom research found 70% of phone users did not plan to sign up to 4G at the end of their contract.

The final major UK network, Three, is launching its own 4G offering in December, starting with coverage in London, Birmingham and Manchester.

It has said it will not charge extra for the faster service.

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