Regulator sees case against iSoft collapse over missing file
22 Jul 2013:
FCA says it will not pursue retrial for major financial crime case after jury dismissed over procedural problem
FCA says it will not pursue retrial for major financial crime case after jury dismissed over procedural problem
iSoft was involved in
the upgrade of the NHS’s IT systems, one of the biggest such projects in
the world. Photograph: Martin Rickett/PA Archive/Press Association
Images
The city regulator has suffered a huge blow to its reputation
after one of its biggest financial crime cases, against four former
company directors of iSoft, collapsed over a missing file.
Stephen Graham, 49, Timothy Whiston, 45, and John Whelan, 46, were cleared of all wrongdoing, after the Financial Conduct Authority decided not to pursue a third trial against the men when a jury was dismissed over a procedural problem.
Patrick Cryne, 62, who has never stood trial due to ill health, was told he too would not now face prosecution.
The regulator had accused the men of fabricating "huge discrepancies" in the company's accounts to deceive investors, in what was only the second criminal case of conspiracy to mislead the markets. The FCA, and its predecessor the Financial Services Authority, have spent £5m of taxpayers' money pursuing the case and now must pick up the defendants' legal costs, which are yet to be determined.
The prosecution ran into trouble when the FCA's barrister recently disclosed a note dating back to 2009 that the defence had not seen. Deciding that the defence would need time to study the document, the judge dismissed the jury, ending the second trial, just days before closing statements were due to begin. The first trial collapsed last year after the jury failed to reach a verdict, after nearly 58 hours of deliberations. The FCA announced on Monday it would not pursue another retrial.
iSoft was involved in the upgrade of the NHS's IT systems, one of the biggest such projects in the world, and was accused of financial irregularities by the regulator following a Guardian investigation.
Welcoming the verdict, iSoft's former chief operating officer, Stephen Graham, said his life had effectively been on hold since the investigation began in the summer of 2006. "In that time, I have had to stand by and watch the company I dedicated 20 years of my life to creating and building, systematically managed out of existence. Also, in that period the FSA investigation and these court proceedings have wasted tens of millions of tax-payers and public pounds and have consumed almost a full year of valuable court time."
Anthony Barnfather, a partner at law firm Pannone, which represented John Whelan, said: "John has spent the last seven years with these allegations hanging over him causing immense stress and anxiety. He has been unable to work, has suffered great financial loss and his reputation left in tatters."
Tracey McDermott, FCA director of enforcement and financial crime, said: "This is of course a disappointing outcome. The problems that have arisen in this case result from a particularly unusual set of circumstances, which are unlikely to recur. As with all our cases, win or lose, we will look to see what lessons can be learned for the future."
COPY http://www.guardian.co.uk
Stephen Graham, 49, Timothy Whiston, 45, and John Whelan, 46, were cleared of all wrongdoing, after the Financial Conduct Authority decided not to pursue a third trial against the men when a jury was dismissed over a procedural problem.
Patrick Cryne, 62, who has never stood trial due to ill health, was told he too would not now face prosecution.
The regulator had accused the men of fabricating "huge discrepancies" in the company's accounts to deceive investors, in what was only the second criminal case of conspiracy to mislead the markets. The FCA, and its predecessor the Financial Services Authority, have spent £5m of taxpayers' money pursuing the case and now must pick up the defendants' legal costs, which are yet to be determined.
The prosecution ran into trouble when the FCA's barrister recently disclosed a note dating back to 2009 that the defence had not seen. Deciding that the defence would need time to study the document, the judge dismissed the jury, ending the second trial, just days before closing statements were due to begin. The first trial collapsed last year after the jury failed to reach a verdict, after nearly 58 hours of deliberations. The FCA announced on Monday it would not pursue another retrial.
iSoft was involved in the upgrade of the NHS's IT systems, one of the biggest such projects in the world, and was accused of financial irregularities by the regulator following a Guardian investigation.
Welcoming the verdict, iSoft's former chief operating officer, Stephen Graham, said his life had effectively been on hold since the investigation began in the summer of 2006. "In that time, I have had to stand by and watch the company I dedicated 20 years of my life to creating and building, systematically managed out of existence. Also, in that period the FSA investigation and these court proceedings have wasted tens of millions of tax-payers and public pounds and have consumed almost a full year of valuable court time."
Anthony Barnfather, a partner at law firm Pannone, which represented John Whelan, said: "John has spent the last seven years with these allegations hanging over him causing immense stress and anxiety. He has been unable to work, has suffered great financial loss and his reputation left in tatters."
Tracey McDermott, FCA director of enforcement and financial crime, said: "This is of course a disappointing outcome. The problems that have arisen in this case result from a particularly unusual set of circumstances, which are unlikely to recur. As with all our cases, win or lose, we will look to see what lessons can be learned for the future."
COPY http://www.guardian.co.uk
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