Satyam Saga: Highs and Lows

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In the latest of the series of damage control measures taken by Satyam, the board is planning to mortgage company assets to raise money for its revival. 40 applications for the post of CEO and CFO are also being considered by the board and the names are expected to be announced soon.

Shares of the company have also surged over 19 percent on the Bombay Stock Exchange (BSE) adding to the positive developments for Satyam.

Although the new board is busy searching for a ray of hope for the success of Satyam’s future endeavours, ongoing investigations are stunting the recovery of the fraud-hit firm. Some of the latest developments in the investigation process are:

Ramalinga Raju may have faked salary accounts: CID

CID said in the court that Ramalinga Raju, in his act of embezzlement, had inflated the number of employees, bagging the salary money which came from the imaginary bank accounts. It claimed that Raju had faked as many as 13000 salary accounts and the extra money was diverted to his own pocket. The investigation authority is busy scrutinising the Rs 5200 crore salary bill for the 2007-2008 term to look for any irregularities.

Gopal Krishna arrested

Gopal Krishna Raju, General Manager, SRSR holdings and Ramalinga Raju’s brother has been arrested by the Andhra Pradesh CID to enable investigations regarding the Satyam scam. SRSR Holdings, owned by Raju’s family, had held 8.27% stake in Satyam in September end and chances of related falsifications in the firm are being investigating upon by the CID.

Satyam management asked to produce asset details by company board

As a part of its internal investigation, the new board of members has asked the management at Satyam to produce their bank account and property details to check for any improper gain by existing officials. Ramalinga Raju, B Rama Raju, Vadlamani Srinivas, executive Ram Mynampati, and company secretary G J Jayaraman have been instructed to provide the details of their assets for in-company investigations.

Meanwhile, Nandan Nelkani, Chairman, Infosys said that the Satyam scam was a “blessing in disguise” as the effectiveness of regulators and other government agencies had been put to test. He said that this episode will result in better auditing mechanism for companies in the future. It is evident from the Controller and Auditor General’s call to scrutinise SEBI and IRDA’s functioning regarding the scam that the government is bent upon looking in every nook and cranny for crucial evidences.