Directors and ex CEO lied about the books
Former company directors and the ex CEO at the now Computer Science Corporation (CSC) owned iSoft have been accused of making false statements in a bid to drive revenue and secure contracts.
The misleading market claims have affected the Health Service Executive (HSE) over in Ireland, which has admitted that it was at the centre of the case with Timothy Whiston, the former CEO of iSoft; Stephen Graham, the company’s ex-commercial director and John Whelan, the former finance director, claiming they had signed a contract with the organisation.
The Irish health service organisation claimed that the trio forged the signatures of its senior executives, which in turn won them huge personal bonuses and also misled investors by transforming what was in reality an £11m (€13.3m) loss on the company books into a profit. They then used these figures to encourage a merger talk with another company in 2003.
Unaware of the fraud, the HSE signed a deal with the company two years later. It also admitted that it retained “multiple contracts” awarded to iSoft over a number of years. However, it was unable to give details as the case was still tied up in legal proceedings.
The iSoft trio are now being prosecuted by the Financial Services Authority (FSA) for their part in the HSE scam as well for misstating iSoft interim reports and end of year financial statements from October 2003 until July 2006. It claimed that these tactics made Mr Cryne and Mr Graham multi-millionaires but also relayed fears that those under trial could have corrupted more junior members of staff at the time.
Mr Whiston, Mr Graham and Mr Whelan all deny the charge of conspiring together to make statements, promises or false acts about iSoft which they knew to be false, misleading or deceptive.
The case will continue into August of this year.