Britain’s Serious Fraud Office (SFO) is reported to have launched a criminal investigation into Tata Steel on charges of falsifying certificates on steel composition at its Yorkshire site, but there was no official confirmation of the probe.
The Daily Telegraph reported on the investigation on Friday, but the SFO told Hindustan Times: “We decline to comment”. There was also no comment on the issue from Tata Steel, which is currently in the process of selling off all its UK assets.
According to the newspaper, the SFO was probing allegations that Tata Steel staff may have falsified certificates detailing the composition of its steel before sale. The company referred itself to the SFO after an internal audit, the paper added.
“Well-placed sources said that the documents being examined affected 500 customers, including BAE and Rolls-Royce. There is also a trading standards investigation, but it is unknown whether they are linked”, the newspaper reported.
It added that auditors had found material that suggested inappropriate testing and certification may have occurred. At least nine employees of the firm had reportedly been suspended. There is no suggestion that the information on the certificates has led to any safety concerns.
A Rolls-Royce spokesman said: “We were made aware of an issue by Tata last year. We have not been contacted by the SFO and cannot comment on any investigation.”
{{/usCountry}}A Rolls-Royce spokesman said: “We were made aware of an issue by Tata last year. We have not been contacted by the SFO and cannot comment on any investigation.”
{{/usCountry}}News of the investigation comes at a time when the process of selling Tata Steel’s UK assets is set to formally begin on Monday. A deal to sell its Scunthorpe plant – talks for which have been on for the last nine months – is expected to be finalised the same day.
The Scunthorpe plant has been on the market since 2014. It is being sold to the UK-based investment firm Greybull Capital for a reported £400 million investment package. The Scunthorpe plant is a key part of Tata Steel’s long products division.
On Friday, Sanjeev Gupta of commodities firm Liberty House and one of the potential buyers of Tata Steel’s UK assets, was scheduled to travel to Scotland for the official handover of two Lanarkshire plants previously owned by Tata Steel.
The two steel processing plants at Clydebridge and Dalzell were previously mothballed by Tata Steel. Liberty House agreed to take on the Scottish plants in an unusual deal in March on the last day before the Scottish Parliament was dissolved for the forthcoming election.
The deal involved the Scottish government taking them over from Tata Steel, reportedly to avoid delays, and immediately handing them on to Liberty House.
Emissions windfall
Meanwhile, according to a BBC report, experts said that Tata Steel made hundreds of millions of pounds selling carbon emissions permits given for free under a European Union emissions trading scheme.
Tata was able to sell the surplus to other firms wanting permits to pollute at an estimated profit of around £700 million (`6,700 crore) around between 2008 to 2014. In 2013 and 2014 Tata Steel’s Europe operations had registered combined losses of around `10,000 crore (£1 billion).
Reports say Tata profited more than any other firm in the UK from the system. Three separate experts said Tata was allocated more carbon allowances than it really needed. Tata refused to comment but there is no suggestion it broke the rules.
Another analyst, Simon Evans from Carbonbrief, believes the windfall was probably double (or £1.4 billion).
Overall it says industry across Europe has earned a £19bn windfall from 2008 to 2014.