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The Australian company that ran the Bibby Stockholm asylum barge has admitted it overcharged the British government by £118m.

Corporate Travel Management (CTM) said its auditor had found evidence of “erroneous billing” of its UK clients, increasing its estimate of how much it owes the government by £40m.

The company said in a statement to the Australian stock exchange that it was “negotiating commercial arrangements” to refund the money.

CTM, which helped provide hotel rooms during the pandemic and accommodation for asylum seekers, has struggled in recent months after irregularities in its UK accounts triggered the suspension of its shares.

The government contractor has said that it knew as far back as 2022 that it had overcharged its clients in the UK by £54.6m. In November 2025, it announced it had overcharged by a total of £77.6m, then on Thursday revised that up to £118m.

The board believed the problem had been resolved with arranged letter agreements with clients to repay the overcharged funds.

However, it said that, in late November, it “became aware of a suggestion that the letter agreements may not, in fact, be authentic”. It added: “This contradicted the position understood and relied on by the board.”

CMT’s former UK chief executive Michael Healy stood down in November and was dismissed from the business in December for “breach of contractual obligations”. Jamie Pherous, the founder and chief executive of the group, retired in February.

A review initially found that under their leadership, CTM had charged the government almost £54.6m more for the quarantine hotel rooms than it was paying by late 2022.

A forensic investigation by auditors at KPMG found further incidents where CTM had overcharged or retained funds that should have been refunded. This has taken the total to £118m.

Ana Pedersen, who is the acting chief executive of the group, said the problems were isolated to the UK business.

“The measures we have taken in the UK business to date have been extensive and thorough, and we will continue to take the necessary action,” she said.

Ewen Crouch, who chairs the business, said that “significant changes have been implemented within the UK business, particularly across financial controls and operational processes”.

He added that the company was aiming for its shares to continue trading on the stock exchange this year.

CTM, which is headquartered in Brisbane, Australia, employs about 3,000 people around the world. It has been a major contractor for the UK government and ran the asylum barge Bibby Stockholm, which was moored in Portland Port in Dorset, until it was decommissioned in November 2024.

The barge has frequently made headlines, including over the death of Leonard Farruku, a 27-year-old who died in the bathroom of his shared cabin onboard in 2023. An inquest concluded that he died as a result of suicide.

A spokesperson for the Home Office said it was conducting an internal investigation into the overspend with CTM.

“We have already recouped over £70m so far from asylum accommodation contracts which were not delivering good value for money.

“Our changes have strengthened contract management and saved £700m in hotel costs alone, as the government works towards its commitment to close every asylum hotel.”