Govt asks SFIO to start prosecution proceedings in Satyam case
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Last Updated: Friday, November 13, 2009, 21:47
  
New Delhi: The Government today asked investigating agency SFIO to initiate prosecution proceedings against persons involved in Satyam accounting fraud and partners of Price Waterhouse, the auditors of the IT company.

"SFIO has been asked to begin prosecution for violation of company law in the Satyam case...it will also be against Price Waterhouse partners", a senior official of Corporate Affairs Ministry told agency.

Serious Fraud Investigation Office (SFIO), an arm of the Corporate Affairs Ministry, had investigated the multi-crore rupee Satyam accounting fraud and submitted its reports to the government detailing violations of company law by founder chairman B Ramalinga Raju and others.

The investigating agency will initiate proceedings on about 30 charges mostly under the Companies Act 1956, while the Central Bureau of Investigation (CBI) will be acting on five or six charges involving criminal offences under the penal code.

The SFIO charges deal with falsification of balance sheet and profit and loss accounts, rigging stock prices, filing of false income tax returns etc.

The Corporate Affairs Ministry asked the SFIO to initiate prosecution in the Satyam case after obtaining opinion of the Solicitor General of India.

Besides Ramalinga Raju, prosecution would also be carried out against Raju's brother Rama Raju, Satyam's former CFO Vadlamani Srinivas, and Price Waterhouse auditors S Gopalakrishnan and Srinivas Talluri.

After the confessions made by Raju to the multi-crore accounting fraud in January, the Corporate Affairs Minister had ordered investigation into the scandal by the SFIO.

The investigating agency submitted a 14,000-page preliminary report to the government in April.

The SFIO report had highlighted various acts of commission and omission by Satyam founder Raju and company's auditor Price Waterhouse.

Raju and PW auditors had been arrested in the case.

Besides SFIO, the Satyam fraud case has also been investigated by the CBI and other agencies of the central and state governments, including SEBI and Institute of Chartered Accountants of India (ICAI).

Satyam, under the directions of the Company Law Board, was sold to Tech Mahindra and has been rechristened as Mahindra Satyam.

Bureau Report


First Published: Friday, November 13, 2009, 21:47


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