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Satyam’s Raju brothers get 7 years in jail for fraud

The sentence is likely to be proclaimed tomorrow.

By: Press Trust of India Written by Sreenivas Janyala | Hyderabad | Updated: April 10, 2015 4:45 am
Satyam Scam, Ramalinga raju, Satyam Ramalinga raju, Ramalinga Raju.

Satyam scandal prime accused B Ramalinga Raju, once the poster boy of the ITeS industry, and his brother B Rama Raju were sentenced Thursday to seven years rigorous imprisonment and fined Rs 5.5 crore each after they were convicted by a special court in the Rs 7,800-crore accounting fraud that shook the country six years ago.

Raju’s youngest brother Suryanarayana Raju, Satyam’s chief auditor V Prabhakar Gupta, former chief financial officer Vadlamani Srinivas, former PricewaterhouseCoopers auditors S Gopalakrishna and T Srinivas, former Satyam accounts and auditors G Ramakrishna, D Venkatpathi Raju and C Srisailam, have also been sentenced to 7 years in jail. They were all fined Rs 25 lakhs each.

Special judge B V L N Chakravarthi convicted the 10 of criminal conspiracy and cheating among other offences.
All the 10 accused were present in court, where media was not allowed, when the verdict was pronounced.  After the order, the judge directed the CBI to take all the accused into custody.

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The court declined to entertain a plea for a lenient view on the quantum of sentence by Ramalinga Raju for his “philanthropic activities”.

“It is not a fit case either for invoking provisions of the Probation of Offenders Act or taking a lenient view on quantum of sentence,” the judge said.

In January 2009, Ramalinga Raju, then Satyam chairman, allegedly confessed to manipulating his company’s account books and inflating profits over many years.

Raju was arrested by Andhra Pradesh CID along with his brother Rama Raju and others. The main chargesheet ran into 2,315 pages and thousands of documents were attached, making it a voluminous 65,000-page case file. It alleged that the Raju brothers devised a mechanism to fudge and fake balance sheets, bank statements and records. They had involved relatives in insider trading.

The eight other accused assisted them in preparing fake invoices, bank confirmation letters and fixed deposit receipts. Besides statements of the Raju brothers and their family members, the CBI named 432 other witnesses but only 232 were examined by the court, mainly Satyam management officials and auditors.

Raju founded Satyam Computer Services in 1987 and built it into a top ITeS firm. But he began to assemble a parallel empire in which dozens of benami companies, fictitious salary accounts were opened in the names of nearly 13,000 non-existent employees. He allegedly set up a well-oiled machinery to forge bank and NBFC statements and certificates, and floated fictitious real estate fronts to purchase land.

By calling for random recruitment from campuses in which thousands were offered jobs, Raju allegedly inflated the company’s staff strength to 53,000 employees when it was only 40,000. Those candidates who were picked up during campus placement were never given appointment letters. But fictitious salary accounts for them were opened.

Raju allegedly confessed to having made at least 400 benami transactions to buy land in several parts of Andhra Pradesh. The Raju family acquired land in Ranga Reddy, Nalgonda and Hyderabad.
Satyam was purchased by Tech Mahindra in April 2009.

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  1. T
    Apr 9, 2015 at 1:55 pm
    Good to see Auditors are also made as accused, the same norm should be applied to officials of enforcement agencies and regulators specifically in case NPA arising out in Public Sector Bank where there is collusion of Bank officials and failure to detect on the part external auditors and RBI officials.
    1. D
      Dashrath Babu
      Apr 9, 2015 at 10:06 pm
      How come even though Ramalinga Raju is in Jail, but his FAMILIY has purchased recently Rs.700 Crores worth BUNGLOW in 11th cross Malleshwaram Bangalore.
      1. M
        Apr 9, 2015 at 9:00 pm
        It is the crime that causes the shame, and the punishment.There are three things in the world that deserve no mercy, hypocrisy, fraud, and tyranny.It is possible that the scrupulously honest man may not grow rich so fast as the unscrupulous and dishonest one; but the success will be of a truer kind, earned without fraud or injustice. And even though a man should for a time be unsuccessful, still
        1. K
          Apr 9, 2015 at 10:05 pm
          Way to go Mr Raju and Andhra!! Leading from the front, and at the pinnacle of Indian achievement always! Keep up the great work, and please be rest ured your hard work is not going in vain, the congress party is watching this very closely!! And as soon as you are out of jail, since Rahul hi has ured India a new type of governance, the 2 stars of Andhra Mr Raju and another already a Cong MP will not be forgotten in central ministerial allocation when the next cong govt is formed. Mr Raju is ured to be the honorable Finance Minister of India and Mr Azharuddin will be eminent sports minister. And Rahul hi has also added this " They are going to make even the Mahatma bow down his head with their honesty ..." and all this while the real starts of Andhra like VVS continue to be sidelined!!
          1. K
            Apr 9, 2015 at 7:57 pm
            Only 7 years jail and Rs 5 crores fine for all the heinous crime? It is an incentive to all others to go berserk! Just think of Maddox!
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