SATYAM SCANDAL- INDIA’S OWN ENRON
The Satyam Computer Services Limited company’s wrongdoing is a corporate scam that occurred in India in 2009 where the chairman, Mr. Ramalinga Raju revealed that the company’s accounts had been falsified.
Background
In 1987, Ramalinga Raju established Satyam, with his brother and brother in law, for providing software development and consultancy services to large firms. The company became public in 1991 and was listed on the Bombay Stock Exchange (Balachandran 2015). Over the years, Satyam endorsed various subsidiaries such as Satyam Enterprise solutions Pvt. Ltd, Satyam Infoway Pvt. Ltd and Satyam Renaissance Consulting Ltd. In 2003, Satyam signed a long-term contract and began supplying IT services to the …show more content…
Not only was it barred from doing any business with the World Bank for 8 years, it also lost its contract of being the official IT service provider for the FIFA world cups in 2010 and 2014. The CBI also reported that the losses suffered by the investors due to this fraud were approximately Rupees 14,000 crores. Satyam lost major clients such as State Farm Insurance and British Petroleum (Sharma n.d., p. 4).
Aftermath
The Satyam case was immediately reported to the Central Bureau of Investigation (CBI). The CBI established a Multi-Disciplinary Investigation Team (MDIT) for looking into the Satyam scandal. As reported by the Central Bureau of Investigation (2009), it filed its first charge sheet against the accused in a time span of 45 days “for offences of cheating, criminal conspiracy, forgery and falsification of accounts.”
In June 2009, the remains of Satyam and Tech Mahindra, which is owned by Mahindra Group, joined hands to form Mahindra Satyam, India’s fifth largest IT export company (Balachandran 2015).
The word “satyam” ironically means “truth”. The Satyam case a typical example of a corporate scam that left the authorities scandalized. It reflects lack of corporate responsibility and integrity by the leaders. Ethical standards in this IT company were thus, quite
The Satyam Computer Services Limited company’s wrongdoing is a corporate scam that occurred in India in 2009 where the chairman, Mr. Ramalinga Raju revealed that the company’s accounts had been falsified.
Background
In 1987, Ramalinga Raju established Satyam, with his brother and brother in law, for providing software development and consultancy services to large firms. The company became public in 1991 and was listed on the Bombay Stock Exchange (Balachandran 2015). Over the years, Satyam endorsed various subsidiaries such as Satyam Enterprise solutions Pvt. Ltd, Satyam Infoway Pvt. Ltd and Satyam Renaissance Consulting Ltd. In 2003, Satyam signed a long-term contract and began supplying IT services to the …show more content…
Not only was it barred from doing any business with the World Bank for 8 years, it also lost its contract of being the official IT service provider for the FIFA world cups in 2010 and 2014. The CBI also reported that the losses suffered by the investors due to this fraud were approximately Rupees 14,000 crores. Satyam lost major clients such as State Farm Insurance and British Petroleum (Sharma n.d., p. 4).
Aftermath
The Satyam case was immediately reported to the Central Bureau of Investigation (CBI). The CBI established a Multi-Disciplinary Investigation Team (MDIT) for looking into the Satyam scandal. As reported by the Central Bureau of Investigation (2009), it filed its first charge sheet against the accused in a time span of 45 days “for offences of cheating, criminal conspiracy, forgery and falsification of accounts.”
In June 2009, the remains of Satyam and Tech Mahindra, which is owned by Mahindra Group, joined hands to form Mahindra Satyam, India’s fifth largest IT export company (Balachandran 2015).
The word “satyam” ironically means “truth”. The Satyam case a typical example of a corporate scam that left the authorities scandalized. It reflects lack of corporate responsibility and integrity by the leaders. Ethical standards in this IT company were thus, quite