Saturday, October 31, 2020

U.K watchdog drops probe into cash printer De La Rue over South Sudan currency

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Shares in De La Rue have risen this morning after the Serious Fraud Office said it has dropped an investigation into suspected corruption in the banknote and passport maker’s South Sudan business.

The Basingstoke-based firm – which has a regional manufacturing facility in East Africa – designed and printed South Sudan’s maiden currency when it broke away from Sudan in 2011.

The Serious Fraud Office, which launched an investigation into De La Rue over suspected corruption and bribery in the country last year, today said it has dropped it.

‘Following extensive investigation and a thorough and detailed review of the available evidence, the SFO has concluded that this case did not meet the relevant test for prosecution as defined in the Code for Crown Prosecutors,’ investigators said.

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The banknote maker said in a statement: ‘De La Rue is pleased that the SFO has closed its investigation and that the SFO is taking no further action in respect of this matter.’

Shares in De La Rue rose 8 per cent to 157p in morning trading on Tuesday.

De La Rue, which two years ago lost the contract to print Britain’s post-Brexit blue passport to a French company, has been struggling in recent years.

The company has blamed its problems on being a banknote printer in what is increasingly becoming a cashless society, although analysts have in the past questioned those claims, arguing it was more down to bad management and decisions.

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Alex Jay, fraud partner at law firm, Gowling WLG, said: ‘This will be a welcome development for De La Rue, so that it can focus on its ongoing turnaround plans.

‘Companies should be vigilant nonetheless when dealing with high risk jurisdictions, because of the risks not only of doing business there but also of regulatory action. Even if not prosecuted, dealing with regulators can be expensive and time consuming.’

The move to a cashless society has increased due to the coronavirus lockdown, but bosses have remained confident that contracts in place would keep its currency factories working at high capacity for the rest of the year.

Apart from one site in Sri Lanka, which stopped production for eight weeks, all the company’s factories have remained open throughout the pandemic.

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