Three more executives suspended in Tomkins perks inquiry

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Three more executives have been suspended at Tomkins, the troubled guns to automotive engineering conglomerate, in a wide-ranging investigation into the group's affairs by its chairman, David Newlands.

Three more executives have been suspended at Tomkins, the troubled guns to automotive engineering conglomerate, in a wide-ranging investigation into the group's affairs by its chairman, David Newlands.

The chairman is said to have suspended Geoff Eaton, head of corporate development and his deputy Simon Webber, along with Anthony Spiro, head of group communications. All three are believed to be on indefinite paid leave while the group decides their future.

The suspensions coincide with an internal inquiry into the abuse of director perks by Greg Hutchings, the group's founder and former chief executive; the probe is headed by Ernst & Young, the accounting firm hired to take over the investigation from Arthur Andersen, Tomkins' auditor.

Neither Tomkins nor Ernst & Young would comment on the matter yesterday. It is not thought that the executives have been involved in the perks scandal that led to Mr Hutchings' resignation last month after his wife and housekeeper were found to be on the Tomkins payroll. Mr Hutchings was also alleged to have made improper use of company assets, including executive jets and two London flats.

The latest fallout from Mr Newlands' investigation is likely to put pressure on other Tomkins executives to resign, among them Roger Holland and Ali Wambold, who is the head of the company's remuneration committee.

Mr Wambold has faced intense criticism from David Herro, a fund manager with Harris Associates of the US, who has called on the non-executive director to resign or be dismissed.

Sir Brian Pitman, chairman of Lloyds TSB Bank and a non-executive director of Tomkins is believed to be spearheading efforts to replace both Mr Wambold and Mr Holland.

The views of Sanford C Bernstein, a fund management group that holds a 5.1 per cent stake in Tomkins, will prove crucial. Brandes Investment, a US fund management group, which holds a 4.3 per cent stake in the company, will also play an influential role.

It is not clear when Mr Newlands plans to conclude the probe and begin drawing a line under the affair.

Tomkins shares have lost nearly 20 per cent of their value in the past year and are down by one-third since August.

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