UK motor dealership chain Lookers has delayed the publication of its 2019 financial results after identifying “potentially fraudulent transactions” in one of its operating division.
In a statement to the London Stock Exchange, Lookers said it identified the transactions in the final stages of preparing its results. The board has decided to postpone the announcement of its results until the second half of April.
“Whilst the initial findings are not material in the context of the group, the board is appointing an external adviser to lead a full investigation into the matter,” said the statement.
The news comes as another blow to the car dealership network, following the FCA’s decision last June to investigate the firm’s sales processes. The Lookers board said at the time that it had uncovered ‘certain matters requiring review’ in its 2018 annual accounts, which it then commissioned an independent review of in December 2018.
Following that, Lookers revealed a £10m cash investment as part of a remediation plan, including a detailed review of past business; the establishment of a revised sales process; a full training exercise across the group; establishment of a new risk management and quality assurance framework; and several developments to the group’s IT systems.
In November 2019, chief executive Andy Bruce and chief operating officer Nigel McMinn stepped down from the Lookers board, as sales and profits dropped.
At the time, a statement from the company said: “The board believes that as well as driving financial efficiencies, this will facilitate an enhanced customer experience in line with the group’s strategy of partnering with the right brands in the right locations. With the exception of two dealerships all will be closed by 31 December 2019.
“The group continues to fully support the FCA in its investigation but, at this stage, we are unable to predict what, if any, impact the outcome of the investigation may have.”