G4S Shares Plunge as Government Criminal Investigation Continues

G4S revealed that it is still in talks with the UK government after the embattled security firm, and its rival, Serco were officially stripped of their electronic tagging contracts with the Ministry of Justice in December last year.

G4S said in its financial results statement that it "remains committed to resolving all matters relating to the electronic monitoring contracts," after it emerged taxpayers had been wrongfully charged for work that was not carried out.

"G4S continues to engage in constructive discussions with the UK government," it added.

G4S shares plunged on the news, falling by 3% in the opening session to around 240.00p.

Meanwhile, the group unveiled its 2013 financial results and said that emerging markets helped the company grow its revenue by 5.8% from the previous year.

The Scandal

At the end of last year, G4S and Serco's rival, Capita, took over both their contracts after they were stripped from the deals.

Capita will be the interim outsourcing security agent for the British government before a new contract is awarded by the justice department in 2014.

Both G4S and Serco are still under criminal investigation by the Serious Fraud Office (SFO) over the tagging contracts scandal.

Details of overcharging only emerged after Justice secretary Chris Grayling made public allegations against the two outsourcing and security firms in July. Both had charged taxpayers for work not done, including the tagging of criminals who were dead.

An internal review by G4S found it had overcharged the government by £24.1m (€29m, $40m) for incorrect billings between 2005 and 2013. The review, carried out by law firm Linklaters, found no "evidence of dishonesty or criminal conduct by any employee of G4S."