Woodford-backed biotech firm ‘can’t prevent fraud’

Neil Woodford

The biotech company in which Neil Woodford holds a 25 per cent stake has admitted it lacks the proper systems and controls to detect and prevent fraud.

The Sunday Times reports Northwest Biotherapeutics has revealed “seven material weaknesses” in relation to fraud prevention processes.

In its annual report, Northwest says it “did not maintain an effective anti-fraud programme designed to detect and prevent fraud relating to an effective whistleblower programme or other comparable mechanism and an ongoing programme to manage identified fraud risks”.

It adds there was a “lack of controls . . . to ensure that all material transactions and developments… are properly recorded”.

Woodford has spent over $180m (£122m) to build up a 25 per cent stake in the business, which as of 29 April was worth $36m.

Northwest is yet to publish the findings of an investigation into allegations its chief executive Linda Powers had funnelled money from Northwest into other businesses she controls.