SFIO told to stop Satyam probe | business | Hindustan Times
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SFIO told to stop Satyam probe

business Updated: Nov 01, 2009 20:47 IST

The government has asked the Serious Fraud Investigation Office (SFIO) to discontinue its probe into the siphoning of funds by fraud-mauled Satyam Computer Services to avoid duplication of work as the CBI is trailing the funds parked abroad by the IT company.

The company has since been renamed Mahindra Satyam under a new management while Satyam’s founder Ramalinga Raju faces fraud charges.

“Now, only the CBI will file a report on the money-siphoning angle in the Satyam case. The SFIO has been asked to discontinue with the probe into that matter. We don’t want any duplications. Now SFIO will file a chargesheet pertaining to company law violations,” a Corporate Affairs Ministry official said.

The ministry had in August asked its investigative arm SFIO to probe into siphoning off of funds by the promoters of Satyam and submit a report within two months.

The decision to ask SFIO to stop probing the money siphoning angle in the Rs 10,000-crore accounting fraud was taken by the Coordination Committee on Satyam set up by the ministry to oversee the investigation and ensure that the case reaches its logical conclusion.

The SFIO, which initially probed the scam, has given a 14,000-page preliminary report to the ministry and is required to submit final report in the case. The SFIO report mainly dealt with violations of the provisions of the Companies Act.

Another reason for asking the SFIO to discontinue the probe was, the MCA official said, because the agency is not empowered to trail funds abroad.

Sources had earlier said the SFIO could seek more time to complete the investigation into the money-siphoning angle as that would require scrutinising the balance sheets of over 350 companies and 800 bank accounts. After Satyam founder B.Ramalinga Raju confessed to an accounting scam in January, there have been suspicions about funds having been shifted overseas.

Although the SFIO had submitted a report in April, sources said the report had not been able to track down the chain of events.