Sebi orders Satyam’s Raju, others to pay Rs 1,849 cr
Ending a five-year probe into the Satyam scam, the Securities and Exchange Board of India (Sebi) on Tuesday ordered the erstwhile company’s then chairman, B Ramalinga Raju, and four others into a 14-year exile from the markets.business Updated: Jul 16, 2014 02:02 IST
Ending a five-year probe into the Satyam scam, the Securities and Exchange Board of India (Sebi) on Tuesday ordered the erstwhile company’s then chairman, B Ramalinga Raju, and four others into a 14-year exile from the markets.
The regulator also imposed a Rs 1,849 crore penalty inclusive of interest, which they have been asked to deposit with the market regulator within 45 days.The four others mentioned in the order are Raju’s younger brother B Rama Raju (then MD of Satyam), Vadlamani Srinivas (ex-CFO), G Ramakrishna (ex-vice president) and VS Prabhakara Gupta (ex-head of internal audit).
Sebi said in its 65-page order, effective immediately: “…no person can be allowed unjust enrichment by way of wrongful gain made on account of fraudulent, manipulative and unfair activities and/or insider trading as found…”
Financial mis-statements to the tune of approximately `12,320 crore were detected as per Sebi’s probe report.
On January 7, 2009 Raju had admitted in an email to Sebi that he had been inflating the cash and bank balances of the company, and also understating liabilities, apart from other financial mis-statements.
“It was like riding a tiger, not knowing how to get off without being eaten,” Raju had said in his email.
Following the disclosure of fraud, the government had auctioned Satyam Satyam Computer Services Ltd to safeguard the interest of investors and employees. Tech Mahindra, an arm of Mahindra & Mahindra, had won the auction. Satyam was renamed Mahindra Satyam, and subsequently merged into Tech Mahindra.
Sebi’s whole-time member Rajeev Kumar Agarwal said in his order that the accused “…have committed a sophisticated white collar financial fraud with pre-meditated and well-thought-out plan and deliberate design for personal gains and to the detriment of the company and investors in its securities.”