Satyam Scam update

B Ramalinga Raju has been found guilty of embezzling from the IT company he founded in a verdict that was widely expected, bringing to a close the trial in India's most high-profile case of corporate fraud.
Raju, 60, the founder of the erstwhile Satyam Computer Services, was sentenced by Special CBI Court Judge BVLN Chakravarthi to seven years in jail and fined Rs.5 crore for his part in falsifying the firm's books to the tune of Rs.7,136 crore. His brother Rama Raju received identical punishment while eight others -his relatives, employees and executives of audit firm Price Waterhouse -were each given jail terms of 7 years and asked to pay Rs.25 lakh as fine.
Raju confessed to the fraud in January 2009 after a failed attempt to reverse-merge Satyam -then be lieved to be India's fourth-largest IT firm with 50,000 employees -with his privately owned realty and infrastructure businesses. Worried the scandal could damage India's reputation and cause the loss of cause the loss of thousands of jobs, the government stepped in to supersede the board and arranged the sale of Satyam to the Mahindra Group in an auction. Nasscom described the fraud as a “one-off case“ and said the verdict vindicates the judicial process. “The judgement today will help reaffirm confidence in investors, global customers and employees that India has strong laws and a process of enforcement when there is a divergence,“ it said in a statement.
Tech Mahindra, the company which acquired Satyam, declined comment on the judgement.
On Thursday , Raju said his confession should be taken as one of the mitigating circumstances in the sentencing. He also claimed to be a philanthropist and to have contributed to the growth of Indian information technology . But Judge Chakravarthi demurred, describing the offence as a grave one that affected the reputation of corporate India. “It is not a fit case either for invoking provisions of the Probation of Offenders Act or taking a lenient view on quantum of sentence.“ Neither the accused nor the investigating agency CBI were happy with the verdict and announced that they would appeal against the sentence. One of Raju's advisers said that the appeal would be to the Metropolitan Sessions court over the next few days with the option to move the High Court and Supreme Court later.
Audit firm Price Waterhouse said it was disappointed with the verdict and said its former partners Gopalakrishnan and Srinivas Talluri were considering filing an appeal. “As we have said many times, there has never been any evidence presented that either of our former partners were involved in or were aware of the management-led fraud at Satyam,“ it said in a statement.
CBI special public prosecutor K Surendra described the sentence as “inadequate“ and said the agency would appeal in the sessions court.
The CBI had accused Raju and his associates of inflating revenues, faking fixed deposits, falsifying accounts and fabricating invoices. Raju was arrested after admitting to the fraud and spent over 30 months in judicial custody at Hyderabad's Chanchalguda central prison before getting bail in the last quarter of 2011. As trials in India go, the Satyam case was completed quite rapidly but not everyone agrees that speedy justice was delivered.
While trials in several cases filed by regulatory bodies and investigating agencies were going on in various courts, a special economic offences court in Hyderabad had in December last year sentenced Raju and his younger brother Suryanarayana Raju to six months in jail and imposed a penalty of Rs.5 lakh each in two cases filed by the Serious Fraud Investigation Office (SFIO). Concluding nearly 68 months of probe in September 2014, the securities market regulator had barred Raju and four others from the capital market for 14 years, apart from asking them to return Rs.1,849 crore in “unlawful gains.“
But court cases are still likely to continue, and not just the Raju appeal. Separately, Tech Mahindra said that the high court has lifted a stay order in a case where the Enforcement Directorate has attached fixed deposits worth Rs.822 crore belonging to the company. It ` said the interim order now allows hearings for consideration of framing charges in the case of alleged moneylaundering by the erstwhile Satyam.