Morgan Utilities confirms staff suspension

Morgan Est has confirmed that a member of staff has been suspended in its Morgan Utilities division pending the findings of "a routine audit" of one of its projects.

Speculation that the police had been called in was denied by a company spokeswoman. "The police have not been involved and until we know the outcome of this investigation we are unable to comment further," she said.

Mark Cutler, as the new managing director of Morgan Est, is said to have resolved to take a stronger personal grip on Morgan Utilities, one of the division's several businesses.

A source said that the project in question is the AX4 refurbishment for United Utilities, in the area around Liverpool.

Reported to be worth £80m, margins have turned out to be "0.5% at best" while in addition, it is said that a lot of money is now in dispute.

The company spokeswoman declined to specify which project was affected. "To comment any further might compromise our investigation," she said.

Graham Carr, managing director of Morgan Utilities, left on 24 June.

The spokeswomen said this was part of a normal sequence of events and was not linked to the investigation.