| Posted on: 2012-01-10/01:32:11 | India - Fraud & Cyber Crime News | Others/ |
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Mahindra Satyam and audit firm Price Waterhouse have slapped cases against each other, seeking to fix the blame for the large-scale fudging of accounts at Satyam Computer Services in 2009. Mahindra Satyam, which took over Satyam Computer in April 2009 after the government superseded its board and appointed an independent committee to conduct a sale, has levelled serious charges against its former management team and auditors, including promoter Ramalinga Raju, accusing them of perpetrating fraud, breaching fiduciary responsibility and negligence in performance of duties. The firm has also sought damages, which some people estimate could be as high as $200 million. The city civil court in Hyderabad will hear the case. A furious PriceWaterhouse has hit back at Mahindra, saying that the firm was the victim of a fraud. "The fraud perpetrated by Satyam was specifically designed to - and did - circumvent Satyam's own internal controls and PW India's audit process, and consequently PW India was a victim of Satyam's fraud, and will defend itself vigorously against Satyam's baseless contentions," a statement from the audit firm said. In Jaunary 2009, Ramalinga Raju confessed to fudging accounts and inflating revenue at Satyam Computer for several years. He quit and was later arrested and jailed. At the time of the confession, the board members included Vinod Dham, Krishna G Palepu, Ram Mynampati and others. Tech Mahindra said last year it intended to take its former chairman Ramalinga Raju and PW to court. We are looking at the possibility of suing Ramalinga Raju and PW as they were party to the scam that resulted in security fraud and litigation. PW was not only negligent but also colluded in it as it did not do its job for so many quarters," Vineet Nayyar, chairman, Mahindra Satyam had told ET last year. As many as 123 officials from the global audit firm have been named as respondents in the case for negligence and complicity. All the respondents were 'jointly and severally liable for paying damages to the company', a senior Mahindra Satyam official said. PW's branches in Mumbai and Kolkata have also been dragged into the suit. "Five categories of people have been sued in which the independent directors have only been named for negligence. The other four include former management, employees, auditors and accounting staff who were on the company's rolls as on January 7, 2009. It is a continuing case and the final amount claimed is yet to be ascertained and assessed," Vivek Reddy, Mahindra Satyam's lawyer said. The court is expected to hear the case when it re-opens on January 17 after vacation. |
| Source: D C | Location : Hyderabad |
