B Ramalinga Raju, the disgraced Chairman of Satyam Computers and his family have continuously inflated the profit of Satyam and offloaded their stake systematically, said Serious Fraud Investigation Office (SFIO), a multi-disciplinary investigation agency, in its probe report on the Rs. 7800-crore Satyam fraud case.
In its report to the Ministry of Corporate Affairs, SFIO reportedly said that the promoters used the invoice management system to hide the inflated data. The password protection was extremely week and could be fetched easily.
For performing the fictitious data, Satyam promoters had made such a complex financial accounting system, added SFIO.
The inflating process began since 2000, when software companies used Y2K solution business and continued till January 05, 2009 when Ramalinga Raju itself accepted for cooking wrong data in the balance sheet of the company.
This announcement shocked the whole corporate world and the scrip of Satyam sank to below Rs.40 per equity.
For maintaining fictitious profit, Satyam always showed an inflated result using imaginary profits. They also showed three fixed deposits (FDs) with Citi Bank, HDFC Bank and HSBC banks those later found as fake.
The report has also pointed out the alleged nexus of Satyam and Maytas, which major stake are held by Ramalinga Raju and his family. According to the report, Raju and his family tried to dilute Maytas into Satyam but failed.
The SFIO has recommended 32 charges on Ramalinga Raju under various sections of the Indian Penal Code, the Companies Act and the Information Technology Act. Moreover, SFIO has also recommended the prosecution of Ram Myanampati, a former director of Satyam, under the Companies Act and asked for taking action against chief financial officer Valdlamani Srinivas and company secretary G Jayaraman.
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