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November 13, 2014

G4S recovers after phoney press release overstates profits

Security company shares bounced back following reports of CFO being sacked.

By Jimmy Nicholls

A phoney press release claiming that the security company G4S had overstated profits by £400m was sent to the media yesterday, prompting a firm denial by the company.

Share prices briefly tumbled on the London Stock Exchange to a low of 262p as a number of journalists tweeted the story, but surged once it was discovered that the release had been fraudulent.

Haydn Simpson, head of brand protection at NetNames, said: "Cyber criminals are well-versed in building copycat websites that look identical to the authentic versions and can cause serious damage to company valuations and hard-won reputations.

"It is not just banks that suffer from fraud, or luxury goods brands that suffer from counterfeiting online – all brands are vulnerable to exploitation."

Alongside the reported accounting error, the release also claimed that the firm’s CFO Himanshu Raja had been sacked, even though he was taking part in a webcast with analysts at the time.

A website set up alongside the press release copied the style of the official G4S site, and a telephone number had even been set up with an automated message telling callers the press office was unable to receive messages.

G4S said: "All official statements by the company are made via a Regulatory Information Service and are available on this web site. Any statements made through other means should be treated with caution and may well be fraudulent."

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