Fresh allegations have emerged about accounting irregularities at G4S, the outsourcer facing a criminal investigation for allegedly overcharging the UK government.

A whistleblower named Malcolm Batki has claimed in court proceedings obtained by the Financial Times that G4S made an internal charge of as much as £4m to a key unit to conceal how profitable it was, while that unit was negotiating contracts with the Ministry of Justice.

Mr Batki, who lost his unfair dismissal case, also alleged that former chief executive Nick Buckles engaged in insider trading.

G4S says it made a “normal and legitimate” accounting charge, according to the judgment, while Mr Buckles says all his share trading followed company rules.

The whistleblower’s allegation of an improper accounting charge is now being investigated by the Serious Fraud Office, according to people familiar with the situation.

The G4S subsidiary in question, Care & Justice, is already at the centre of an investigation by the SFO over whether it overbilled the taxpayer by £24m for electronic tagging and prison escort contracts. The unit represents about 8 per cent of the group’s £8bn revenues worldwide.

The allegations will result in more scrutiny of the company, which must prove it has improved compliance when bidding for new government contracts.

Mr Batki was a finance director at G4S Integrated Services until January 2011. He made the allegations about the accounting charge as part of a claim against the company after he was dismissed.

Mr Batki lost his case in 2012 but a tribunal found that he had made a “protected disclosure” under whistleblowing laws over the accounting charge. It found, however, that the company had fired him not as a result of blowing the whistle but as part of a wider restructuring, according to the tribunal’s judgment.

It did not make any findings as to the legality or otherwise of the accounting charge, which the company told the tribunal was “perfectly normal and legitimate”, the judgment reads.

The Employment Appeals Tribunal in 2013 and the Court of Appeal last month also refused challenges by Mr Batki because he was not appealing on points of law.

Mr Batki alleged during proceedings that Mr Buckles had engaged in insider trading in 2009 when he exercised share options a month after asking subsidiaries to “post the best possible results” and defer “major one-off issues” in the company’s interim accounts, according to the tribunal judgment.

Mr Buckles, who was not a party to the proceedings, told the Financial Times: “Any share sales or purchases made by me have always been undertaken in accordance with the company’s rules on share dealing and with the relevant approvals. Also on this occasion some of the options were reaching their ten-year limit and needed to be exercised.”

The tribunal did not make any findings over that transaction but said it was not a protected disclosure by Mr Batki as he could not prove that he had believed wrongdoing had taken place when he discussed it with his superior.

G4S said it took any allegation “very seriously” but would not comment beyond its evidence to the tribunal over the accounting charge. It said Mr Buckles’ share transaction was authorised, announced, and not during a close period.

The SFO declined to comment.

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