- Services company Serco Group said a UK subsidiary had reached an agreement with the UK Serious Fraud Office that would involve it paying a £19.2m fine and £3.7m of investigation costs.

The proposed deferred prosecution agreement involving subsidiary Serco Geografix was subject to a final judicial approval, to be sought in court by the parties on 4 July.

If confirmed by the court, it would conclude the Serious Fraud Office's investigation into Serco companies announced in November 2013.

Serco Geografix had taken responsibility for three offences of fraud and two of false accounting committed between 2010 and 2013, Serco said.

They related to the reporting to the UK Ministry of Justice of the levels of profitability of Serco's electronic monitoring contract.

Those issues were reported by Serco to the Serious Fraud Office and the ministry in November 2013.

Investigations into allegations of wrongful billing had now been concluded without any criminal charges against Serco.

Serco Geografix would pay a fine of £19.2m together with £3.7m related to the Serious Fraud Office's investigation costs.

The fine reflected a discount of 50% as a result of Serco's self-reporting, as well as its significant and substantial cooperation with the investigation, Serco said.

'Those of us who now run the business are mortified, embarrassed and angry that, in a period between six and nine years ago, Serco understated the level of profitability of its electronic monitoring contract in its reports to the Ministry of Justice,' Serco chief executive Rupert Soames said.

'Serco apologised unreservedly at the time, and we do so again.'

'Nobody who sat on the board of Serco Group, or who was part of the executive management Team at the time these offences were committed, works for the group today.'

'Over the last six years we have worked extremely hard to regain the trust and confidence of government, implementing in its entirety a corporate renewal programme which was approved by government and which has helped us to transform our corporate culture, processes and governance.'

'The management and culture of Serco, and the transparency with which we conduct our affairs, have changed beyond all recognition, and we are pleased that this has been acknowledged by both the SFO and by the government.'

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