Software firm's ex-bosses face seven years

Three former software company bosses are the first in the UK to face criminal charges over misleading the market.

The former directors of Henley-based CIM specialist AIT were remanded yesterday by London magistrates to Southwark Crown Court on four charges of misleading the market.

They are alleged to have issued a statement to the stock exchange’s Regulatory News Service knowing it to be misleading, false or deceptive.

The statement on May 2, 2002, said that turnover and profits were expected to be in line with market expectations. But four weeks later, the company issued a profits warning which caused an 80 per cent drop in its share price.

Shortly afterwards the company was forced into a £20.5m rescue refinancing which slashed the existing shareholders' stake.

A spokesman for AIT said: "these proceedings do not affect AIT in any way. They relate to matters which predate the appointment of the current management and have no implications for our business."

The three men; Carl Rigby, former chief executive, Alistair Rowley, former sales director and Gareth Bailey, ex-finance director, face charges of making a misleading statement, recklessly making a misleading statement and of conspiring to do both.

The preliminary hearing at Southwark Crown Court is scheduled for 2 March. The Financial Services Authority said that this was its first criminal prosecution.