AN investigation into Serco's handling of a £285m prisoner escort contract has been dropped by police, the company has confirmed.

Police were alerted last year over claims staff had been misleadingly recording prisoners as ready for court when they were not.

However, Serco said the investigation found no evidence of a conspiracy or intention to falsify figures, adding the Crown Prosecution Service had dropped the case.

Serco, which runs the International Fire Training Centre (IFTC) at Durham Tees Valley Airport, says it will continue to run the seven-year prisoner contract, which covers transfer services in the South.

But the company still faces an ongoing Serious Fraud Office investigation in the wake of an electronic tagging affair last year, in which it, as well as rival G4S, were accused of overcharging the Government for monitoring offenders.

The scandals led to the resignation of its chief executive Chris Hyman, who was replaced by Rupert Soames.

Last month, Mr Soames slashed the firm's profits guidance for this year and next, and wrote down the value of the business by £1.5bn.

Serco previously told The Northern Echo it remains fully committed to the IFTC after investing in the site.

The centre has trained thousands of people, including firefighters from France, Germany and Poland.