Suspended sentence for ex-Allied chief

THE former managing director of Allied Carpets, who fiddled the figures to inflate sales by more than £6m, has been given a suspended prison sentence.

Raymond Nethercott, 54, pleaded guilty to two charges of misleading Allied's auditor, Arthur Andersen. He was sentenced to nine months' jail, suspended for two years, and ordered to pay £15,000 prosecution costs. The sentence took into account that he had already paid Allied £775,000 and been disqualified as a director.

Between 1992 and 1998, Allied used an accounting practice known as pre-dispatching - booking sales early. Sales were overstated by more than £6m, boosting profits by more than £2m.

The two charges against Nethercott, of Tilehurst, Reading, involved two letters to Andersen in 1994 and 1996, stating that the accounts were true. Prosecutor Peter Gower, for the DTI, said: 'In fact, these assertions were false.'

Allied's official accounting policy was explained in a statement to Blackfriars Crown Court by Andersen managing partner John Ormerod. Gower pointed out that Andersen was never aware of the goings on, some relief for the firm that has been destroyed by the Enron scandal.

Allied, floated in 1996, had its shares suspended in 1998 after the sales irregularities emerged.