Showing posts with label SEBI. Show all posts
Showing posts with label SEBI. Show all posts

Wednesday, January 28, 2009


Satyam scam which involved Rs 70 bn or may be more, is not something that will fade away in a hurry. Former Chairman of Satyam Computers, Ramalinga Raju courted arrest after admitting to the fraud, but he has set the wheels of intrigue into motion. One can sense that there must be many scams within the main scam, many plans within the main plan, many crimes within the main crime and many actors alongside the main protagonist.

We are being consoled that Satyam scam is just a one -off case , an exception to an otherwise honest and trustworthy system of governance of Indian companies with myriads of foolproof checks and balances. Believe all these official statements at your own peril. Otherwise seek answers to the following shortcomings :-

(a) After someone admits to a financial crime of horrendous proportion in public, does it take the law-keepers more than 72 hours to even talk to the perpetrator? That too after the fraudster himself walks into Police Headquarters to surrender? It is now believed Ramalinga Raju did a Charles Sobhraj act in order to escape the long hands of the firm and just Law of United States of America which could put him away for 25 years for cheating its citizens. He therefore decided to get legal proceedings initiated against him in India. In this fashion the US Law-Keepers will have to wait for the proceedings to be over in India before they can get hold of his neck , which by conservative estimate should not be before 15 years. Here on home ground Ramalinga Raju can enjoy the luxury of being on bail. Should we allow Ramalinga Raju to execute this plan?

(b) Why did Raju ostensibly come clean while submitting his resignation? Did anyone ask him any discomforting questions? Not a single eyebrow was raised on the economic viability and vibrancy of Satyam before he sang. Even the Goliaths of the Financial World were rudely taken by surprise prompting them to jettison shares of Satyam from their Portfolios at fire-sale prices. The question that still begs an answer is this - what propelled Raju to tell the world that look here I am, a fraud. The extent of my fraud is Rs 70 billions and now come and catch me . Something is amiss- something escapes logic.

India cannot afford to let Satyam drift away into oblivion. Brand India cannot afford to let Satyam be quoted in history as a failed company. As things unfold, the unshaken belief of investors and stake holders of Satyam in Satyam will be vindicated. What the world has to realise is that the company never failed- there has been a robbery in the company. Some robbers have been nabbed and rest of the accomplices will also be ferreted out by the investigators.

The global investor is gauging India and its ability to contain such individual acts of looting and daylight robbery. To reassure him that this scam is a one -off case there should be determined and elaborate exhibition of swift and exemplary punitive action against the perpetrators of the crime. This should be coupled with a comprehensive financial resuscitation programme for the company . Even now its not too late to show the world India's keen sense of purpose to deliver justice and restore Satyam Computers to its rightful health. In case we are unable to deliver properly on this issue of Satyam , then rest assured there will be many more Satyams that we have to deal with. God forbid if that happens; then we can never ever restore faith of the global investor in Brand India? This branding exercise has taken painstaking 15 years or so, which may be blown away by our inept handling.. We will in that case witness a domino effect on Indian industry, starting with IT industry?

We need no crystal ball gazing to arrive at the conclusion. Indian economy is at a threshold of either leapfrogging ten years ahead or retracing ten years backwards . Lets acknowledge that we are witnessing a Watershed Moment in the history of Indian Economy. Let us all pray that India plays the cards properly, starting with Satyam.