BAT shares fall after US sanctions probe report

British American Tobacco shares fell after the company was reported to be the subject of a US criminal investigation into suspected sanctions breaches.

The US Department of Justice (DoJ) and Office of Foreign Assets Control (Ofac) are investigating "suspicions of breach of sanctions" by BAT, The Times reported. Ofac is a financial intelligence and enforcement agency that is part of the US Treasury.

The paper said it was not clear which country or countries of the 180 markets where BAT operates were under investigation by the US.

Shares of BAT, whose cigarette brands include Lucky Strike and Dunhill, dropped 4.7% to £28.80 at10:38 BST, making it one of the biggest fallers in the FTSE 100 index.

In its annual report, published in March, BAT said it was “aware” of the investigation and was in discussions with the DoJ and Ofac. BAT said it could not estimate the potential financial effect but that it could be material. It said it could not say when the investigation would be resolved.

BAT, the world's second-biggest cigarette company, is already under investigation by the UK's Serious Fraud Office for suspected corruption.