Complaints India - Articles
The Major Corporate / Company Frauds that shook India in 2009-10!
09 March 2010 David N (Complaints India)
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Satyam Computer Services Scam - January 2009.
All hell broke lose across the world when in Jan 2009, the Chairman of Nasdaq listed Satyam Computer Services owned up to gigantic corporate fraud of embezzlement, share price rigging and falsification of accounts.
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| CBI in Nov 2009, filed supplementary charge sheet against B Ramalinga Raju and nine others, pegging the Satyam fraud at Rs 14,000 crore instead of the Rs 7800 crore that Raju had owned up to in January 2009.
CBI in Nov 2009, filed supplementary charge sheet against B Ramalinga Raju and nine others, pegging the Satyam fraud at Rs 14,000 crore instead of the Rs 7800 crore that Raju had owned up to in January 2009. There was massive fund diversion from Satyam to buy thousands of acres of land in the name of companies promoted by Raju. The charge sheet also identifies 1065 properties with a documented value of Rs 350 crore that were acquired by the Rajus with the spoils of the fraud.
These include 6,000 acres of land, 40,000 sq yd of housing plots and 90,000 sq ft of built-up property. He is accused to have diverted payments receivable by Satyam from operations into benami accounts virtually bleeding the company. Money is also said to have been diverted to set up real estate development business of his younger son, Rama Raju Jr, and infrastructure business of his elder son, Teja Raju.
PWC Auditors Scam -January 2009
Price Water House Coopers and its associates are accused of direct involvement in Satyam Computers Fraud. The arrest of 2 of its partners S Gopala Krishnan and Srinivas Talluri dented the global image of PWC. These auditors are accused to have worked hand in glove with Ramalinga Raju(then Chairman of Satyam), Rama Raju(then MD) G Ramakrishna, then Vice-President (Finance), D Venkatapathi Raju (Senior Manager Finance) and Srisailam (Assistant Manager) in Satyam Computer Services Ltd (SCSL).
PWC also saw large desertion of senior staff (about 200 employees partners) in late 2009/early 2010.
Wipro Scam -January 2010
Scam news from Wipro shook the IT world in Feb 2010. An employee in the company's finance department had coolly defrauded Wipro of US$4 Million(~18Crore) over a period of time! It was bad news indeed! How can Indian Companies who do not have strong accounting systems in place be trusted to build large banking networks?!
Wipro has been very selective in giving out news to avoid bad publicity. But experts opine that this scam would not have been possible without involvement of many people in Wipro. The scam also exposed the inept and inadequate financial control and audit functions under Suresh Senapaty, Corporate Executive Vice President-Finance and Chief Financial Officer, Wipro
City Limouzines India - 2009 -2010
A string of fraud companies named City Limouzines, City Real Com, Aim Limouzines etc were floated by scamster Syed Masood and his associate Seema Razzaki with the sole aim of collecting huge amount of money by offering high returns. They used to send cheques to members from money collected from new members. The lure of money resulted in more than 25,000 people joining his schemes which included car rental, property rental etc.
The money collected by this scamster is said to be more than 3000Crores! All businesses were just on paper with nothing on ground. The criminal network spread fast with offices across the length and breadth of India collecting moneyThe crook Syed Ahmed is said to have invested collected money in crores in Real Estate, Stocks and even in Bollywood.
Police had arrested their directors Umar and Geeta Razzaki in November. But the top crooks Syed Masood and his side kick Seema Razaki were absconding. Eventually, Mumbai Police's Economic Offences Wing (EOW) arrested the criminals on February 5th 2010 and since then they are in Jail. But with huge amount of public money with them, they may be able to get out easily.
The people who have lost money have to contact nearest police station and file complaints so that strong case is built up and money recovered can then be distributed to people.
Punjab National Bank (PNB) 35 Crore Fraud - June 2009
The event in PNB involving its own mangers shook Indian Banking world. The PNB mangers are said to have made Crores by settling outstanding loans to companies at peanuts. For example Chanana Steels and Tubes owed Rs 18.27 crore but settlement was done for just Rs 20 lakh. In another case, Balaji Manganese was allowed to settle Rs.16crore loan for few lakhs!
All this while individual customers are hounded and huge penalty is charged for small loan defaults.
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