Britain has opened a formal investigation into suspicions of corruption at British American Tobacco (BAT) and its subsidiaries, nearly two years after allegations of bribery in Africa first surfaced. As Ciara Lee reports, the move comes after shares in BAT tumbled 12 percent in the previous two sessions following a proposal by the U.S. government to cut nicotine in cigarettes.
It's been nearly two years since bribery allegations first surfaced against British American Tobacco and its subsidiaries. Now Britain's Serious Fraud Office has opened a formal investigation into suspicions of corruption at the world's largest international tobacco company. BAT says it will cooperate but offered no further comment. Shares in BAT, tumbled 12 percent in the previous two sessions. That was following a proposal by the U.S. government to cut nicotine in cigarettes. SOUNDBITE (English) OANDA SENIOR MARKET ANALYST, CRAIG ERLAM, SAYING: "The investigation in the US with regards to nicotine levels has delivered a significantly negative impact on the share price over the last 48 hours, shares are down more than 10 percent. And I think in comparison this is seen as probably a much smaller issue for the company. So while while shares are trading up more than 1 percent today in comparison to what they fell over the last two days it's actually extremely small." The maker of brands including Dunhill and Lucky Strike last year appointed a law firm to investigate allegations of historic misconduct in Africa. It came after a 2015 BBC programme described cases of BAT employees bribing officials in East African countries including Rwanda and Burundi in an effort to undermine anti-smoking laws. Last week BAT unseated Marlboro maker Philip Morris International as the world's largest international tobacco firm, following its $49 billion takeover of Reynolds American.