LONDON, Oct 6 (Reuters) - British retailer Tesco has held talks with the Serious Fraud Office (SFO) over a dealto settle a criminal investigation into its accounting errors,Sky News reported on Tuesday.
The SFO opened a formal criminal investigation into errorsat Tesco almost a year ago, after the firm admitted overstatingits profits by 263 million pounds ($400 million), a revelationthat hammered the reputation of the country's biggest grocer.
Sky News said Tesco had been in discussions with the SFOabout the possibility of signing a deferred prosecutionagreement (DPA) - a court-approved deal under which the companyadmits wrongdoing but avoids any immediate criminal sanctions.
"We have said before that we are not commenting on DPAs andthe investigation into Tesco is still ongoing," a spokesman forthe SFO told Reuters, referring to the Sky News report.
Tesco declined to comment.
The SFO gained powers to agree DPAs in February last yearbut has yet to agree such a deal.
Under a DPA, a prosecutor charges a company with a criminaloffence but proceedings are automatically suspended and thecompany agrees to a number of conditions, such as paying apenalty and compensation. If the company does not honour theconditions, the prosecution may resume.
DPAs, which apply to organisations and not individuals, canbe used in cases of fraud, bribery and other economic crimes.
($1 = 0.6569 pounds) (Reporting by Kate Holton and Sinead Cruise; Editing by PravinChar)