Sorry Carlo but none of this bodes well for him!
The company will have a policy on this procedure. It may well be that they have a policy that states where 'Serious Misconduct' is alleged then suspension without pay is allowed. It would be unusual but it could happen.
I note that he was interviewed by the company security team and now by police. That is because it is a 'Criminal Offense' that is alleged here. So the rules are totally different to Employment Law. If there is evidence and indeed he has admitted to it then it will become a police matter. The company are still obliged to go through a Disciplinary Procedure and indeed this can happen in his absence should he be unable to attend any hearing.
However, I have to say that on the details available I think he can expect to be either 'Summarily Dismissed' (sacked) or he may be offered the chance to Resign. I would doubt they'll give him this chance but if they do and it was me, I'd take the offer! This gives him a 'clearer' CV than it would if he were sacked. You see, most companies these days answer reference requests with a standard and basic reply in order to avoid any possible discrimination. So if a company that he may apply to in the future asked for a reference and this company operates a 'Standard Reference Request' then having 'Resigned' they will only state that. If he has been Summarily Dismissed, they will state that. You can see which looks better for him to a new employer.
People Resign every day for various reasons, new job, moving away, new baby etc etc. And obviously that would be ANY prospective employer in ANY industry he choses to apply to. If a reference request came back and it states Summarily Dismissed he is going to be asked about that (that's if any prospective employer even offers him the chance of an interview with that record!). He will have to tell them what happened. Now I know he's your pal and all but it really doesn't look great when someone says I was sacked for fraud and obviously that applies to ANY industry he choses to apply to! There is also the possibility that he will be tried in the courts for this and possibly end up with a criminal record. Again, he would normally be asked if he has any 'unspent' criminal record on a job application!
As for whether the case will be dropped, the company MAY decide not to prosecute but I'm not clued up on the CPS and their procedures.
Given the details, I would have to say that at this point in time things don't look too good for him!