isc was acquired by ferranti in november 1987. this merger caused the collapse of ferranti due to the debts of its new subsidiary. ferranti was eventually broken up and the majority of the defense subsidiaries were purchased by gec. on october 31, 1991, isc founder james guerin, and 18 others were indicted by a philadelphia federal grand jury on charges of a "$1.14 billion fraud (ferranti/isc merger of november, 1987)" and the illegal sales of arms to south africa and iraq. on december 5, 1991 guerin pleaded guilty to eight charges including: conspiracy to inflate the accounts of isc by means of non-existent international contract supported by false paperwork and circular cash transfers; conspiracy to defraud ferranti shareholders and investors (at the time of merger with isc in 1987); obtaining finance on fraudulently inflated share values when isc plc was floated on the london stock exchange in 1982, and money laundering between us, uk and swiss banks. he was sentenced to a 15-year prison term.