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Corporate Travel Management Discloses Evidence of Forged Agreements and Overcharging UK Government by up to £128 Million

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CTM Overcharged UK Government by Up to £128 Million

Corporate Travel Management (CTM), an Australian-listed travel company, has disclosed that it overcharged UK government entities by up to £128 million (approximately $240 million AUD) across multiple contracts. The company also reported that signed agreements related to refunds may have been forged by a former UK executive.

"We acknowledge the findings are difficult and confronting." — Chairman Ewen Crouch

Summary of Findings

CTM announced to the Australian Securities Exchange (ASX) that it had identified potential revenue reversals of up to £128 million — a sharp increase from a previous internal estimate of £78 million.

The overcharging is understood to have occurred across several UK government contracts, including:

  • A £1.6 billion program to accommodate asylum seekers on barges
  • A project to repatriate 38,000 British travelers during the COVID-19 pandemic

Timeline of Events

Internal Discovery (2022)

CTM's board was first alerted to payment discrepancies in 2022. At that time, the company identified a gap of £54.6 million between the amounts paid to hotels and the amounts billed to the UK government customer.

Initial Investigation and Refunds (2023)

In the first half of the 2023 financial year, CTM and its auditor, PwC, relied on information provided by the company's former UK CEO, Michael Healy, to investigate the matter. By July 2023, CTM believed it had resolved the issue.

The company prepared letters of agreement with UK customers, which led to refunds of £28 million. Mr. Healy provided CTM with copies of these agreements, which appeared to be signed by the customer.

Discovery of Forged Agreements (November 2024)

In November 2024, CTM stated it became aware that these letter agreements "may not, in fact, be authentic." The UK government customer reportedly informed CTM that it had no record of the agreements. CTM stated that the agreements lacked independent corroboration that they were signed by the customer.

Personnel Actions

Michael Healy, former CEO of CTM's UK and European operations, was removed from his position in 2024 and subsequently dismissed. CTM confirmed it has made notifications to relevant authorities regarding his conduct.

The company attributed the problems primarily to actions of a single UK executive but stated it is improving financial controls and conducting a review of broader governance practices.

Financial Impact

The company stated it will not be required to repay the full £128 million, as some repayments have already been made and it may be eligible to claim back certain taxes paid on the wrongly booked revenue. However, CTM faces potential penalties and interest.

Key financial figures:

  • $115.7 million in cash held as of last month
  • $75 million in potential borrowing capacity
  • $140 million in a new funding line secured

Chairman Ewen Crouch stated that financial accounts for years since 2019 will be restated. The company expects to lodge restated accounts by June 30, 2025, and aims to resume trading of its shares, which have been suspended since August 2024.

Leadership Transition

In a separate but related development, founder Jamie Pherous left his role as managing director. The company described his departure as a mutual agreement with the board, reflecting a move toward stronger governance. Mr. Pherous will remain as a consultant for six months.

Ana Pedersen, the company's chief commercial officer, has assumed the role of acting chief executive.

External Scrutiny

  • Law firms are reportedly considering potential class action lawsuits
  • The UK Home Office confirmed it was informed of the overbilling and is investigating the situation
  • PwC's audit work is expected to face scrutiny