Satyam case:Sebi bans Raju, others for 14 years;seeks Rs 1,849cr

Tags: News
Closing five-and-a-half year long probe into the country's biggest corporate fraud, Sebi today barred erstwhile Satyam Computer's founder B Ramalinga Raju and four others from markets for 14 years and asked them to return Rs 1,849 crore worth of unlawful gains with interest.

The money needs to be deposited with Sebi within 45 days, while interest would be levied at 12 per cent per annum with effect from January 7, 2009 -- the day this mega-scam came to the light through a letter written by Raju himself.

The others facing the prohibitory orders include Raju's brother B Rama Raju (then Managing Director of Satyam), Vadlamani Srinivas (ex-CFO), G Ramakrishna (ex-vice president) and VS Prabhakara Gupta (Ex-Head of Internal Audit).

In its 65-page order, effective immediately, Sebi said these five persons "have committed a sophisticated white collar financial fraud with pre-meditated and well thought of plan and deliberate design for personal gains and to the detriment of the company and investors in its securities".

The regulator, which has exercised the powers given to it through promulgation of an ordinance for passing disgorgement orders, further said that the "financial frauds as found in this case are inimical to the interests of the investors in securities and endanger the

market integrity".

Sebi's Whole-Time Member Rajeev Kumar Agarwal said in his order: "I am convinced that this is a case where befitting enforcement action is necessary to send a stern message to the market to create an effective deterrence."

On January 7, 2009, Raju - the then Chairman of Satyam Computer - had sent an email to the Sebi, wherein he admitted and confessed to inflating the cash and bank balances of the company, besides understating liabilities and other financial mis-statements.

After the fraud came to the light, the government had ordered an auction for sale of the company in the interest of investors and employees of what was known at that time as the country's fourth largest IT firm.

The company was acquired by Tech Mahindra, then renamed as Mahindra Satyam and eventually it was merged with Tech Mahindra.

EDITORIAL OF THE DAY

  • India's engagement with Iran looks iffy without Farzad gas deal

    India’s quest for West Asian oil is not going to come too easy, anytime soon.

FC NEWSLETTER

Stay informed on our latest news!

TODAY'S COLUMNS

BK Chaturvedi

Time ripe for state funding of elections

Prime minister Narendra Modi had laid strong emphasis on improved ...

Rajgopal Nidamboor

The resonant cadence of our being

The real voyage of discovery,” wrote Marcel Proust, the French ...

Dharmendra Khandal

Biodiversity day has come and gone. Yet again

Every year on May 22, world celebrates international biodiversity day. ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture