July 22 (Bloomberg) -- The former chief executive officer and two former directors of iSoft Group Plc, who were accused by the U.K. finance regulator of lying to the market about revenue, won’t be retried after the case collapsed for the second time.
Timothy Whiston, the former CEO of the software company, Stephen Graham, the company’s ex-commercial director, and John Whelan, its former finance director, won’t face a third trial, lawyers for the U.K. Financial Conduct Authority told a London criminal court today. Patrick Cryne, the former chairman of the company, also won’t be prosecuted.
The first trial failed in August last year after the jury couldn’t reach a verdict. The second trial collapsed earlier this month after the judge dismissed the jury because the FCA made disclosure errors.
The case is “now stale,” Richard Latham, a lawyer for the FCA, told the court. A third trial would be “a huge cost to the public purse.”
The regulator had accused them of misstating iSoft interim reports and year-end financial statements from October 2003 until July 2006, and lying to external auditors, saying the company had won a contract to supply software to an Irish hospital system when it hadn’t yet.
The defendants made the statements to win a contract from the U.K.’s National Health Service and encourage 2003 merger talks with another company, the regulator said. The men were charged in January 2010. Cryne didn’t face trial with the other three men because of health problems.
“This is of course a disappointing outcome,” Tracey McDermott, director of enforcement and financial crime for the FCA, said in a statement. “The problems that have arisen in this case result from a particularly unusual set of circumstances, which are unlikely to recur.”
Whiston said the verdict comes “as a relief as my name is finally cleared after seven years of investigation and prosecution.”
The defendants will have their legal costs paid for them by the FCA, Anthony Barnfather, a lawyer for Whelan, said in a statement.
Whelan “has always strenuously denied the allegations and is delighted he can now finally begin to rebuild his life.”
Australia’s iSoft Group Ltd., which develops and markets health information computer software, acquired U.K.-based iSoft Group Plc in October 2007 after the events that were the subject of the investigation. ISoft was later bought by Falls Church, Virginia-based Computer Sciences Corp.
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