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Tesco market abuse compensation scheme to be run by KPMG

KPMG will run the compensation scheme for investors affected by the market abuse committed by Tesco plc and Tesco Stores Limited in 2014 over them giving the false value of shares and bonds.

The Financial Conduct Authority (FCA) announced that Tesco plc and Tesco Stores limited have admitted that they committed the abuse relating to a trading update published in August 2014 that revealed a false value of Tesco shares and bonds, causing inflation. This is the first time the FCA has required a listed company to pay compensation for market abuse.

Tesco have agreed to pay the compensation to investors who purchased shares and bonds from August until September 2014, when the overstatement was identified. The FCA estimated the total amount of compensation payable under the scheme will be around £85m, across an estimated 10,000 eligible investors across that period, with 320m shares between them.

Tesco Stores Limited has also today entered into a deferred prosecution agreement (DPA) with the Serious Fraud Office (SFO) relating to false accounting, and it will pay a fine of £128,992,500.

The compensation scheme will launch by 31 August 2017 and will be administered on Tesco’s behalf by KPMG, who will release in advance information on how to submit. Further information is available now on KPMG’s website.

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