Multiple agencies continue probe into Satyam fraud

January 14th, 2009 - 8:20 pm ICT by IANS  

Ramalinga RajuHyderabad, Jan 14 (IANS) The Andhra Pradesh police is sifting through documents seized from Satyam Computer Services and its auditors PricewaterhouseCoopers (PwC) in connection with the Rs.70-billion ($1.43 billion) accounting fraud, the police said Wednesday.”There are many documents and data available to us. We are sorting out what is required for the investigation and analysing them,” Additional Director General of Police (CID) A. Shivanarayana told IANS.

Satyam Computer’s disgraced former chairman B. Ramalinga Raju shocked the corporate world last week by admitting to committing a Rs.70-billion ($1.43 billion) accounting fraud. Raju, his brother and former managing director B. Rama Raju, along with former chief financial officer Vadlamani Srinivas, have since been arrested.

The Andhra Pradesh police, the Registrar of Companies, market regulator Securities and Exchange Board of India (SEBI) and the Serious Fraud Investigation Office (SFIO) are probing the fraud.

The Criminal Investigation Department (CID) Tuesday conducted a search at the PwC office here. The search continued till midnight.

Shivanarayana said no fresh arrests have been made and denied that vice president of accounts G. Ramakrishna was in CID custody.

“This is part of the ongoing investigations,” he said, when asked if the police were questioning Ramakrishna and other employees in the finance and accounts department of Satyam.

Ramakrishna’s role is being probed in the light of the confession statement by Srinivas, who denied any knowledge of the manipulation of accounts.

The former CFO told CID that Ramakrishna used to take care of book keeping, accounts payable and accounts receivable and treasury management. He also said that Ramakrishna used to prepare the balance sheet with a team of 20 employees.

The CID also declined to confirm if they would be questioning former directors like former interim CEO Ram Mynampati, former International School of Business dean Rammohan Rao and former cabinet secretary T.R. Prasad.

“We will question any person if the need arises,” said an official.

Mynampati, who continues to be a Satyam employee, is currently in the US to talk to clients and address their concerns over the massive fraud.

Ramalinga Raju quit Jan 7 while confessing that the company’s profits had been falsely inflated for years. He along with his brother were arrested two days later on charges of criminal breach of trust, criminal conspiracy, cheating, falsification of records and forgery. The next day, a magistrate sent them to jail till Jan 23.

The former CFO, who was arrested Jan 10, was also remanded to judicial custody. All the three are in the Chanchalguda Central Jail here.

Meanwhile, officials of SFIO continued to go through the records at Satyam offices. The multi-disciplinary agency is probing the accounts books of the IT bellwether. The central government has asked SFIO to submit its report in three months.

SEBI is also continuing its investigations into the fraud. Its petition seeking permission to question Ramalinga Raju and others will come up for hearing in a city court Friday. SFIO may seek a similar permission.

The Registrar of Companies (RoC) has reportedly submitted its preliminary report to the ministry of company affairs. It has found prima facie evidence of cheating against Satyam’s top management.

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