MTAALAMU WA COMPUTER ASHTAKIWA KWA UDANGANYIFU
B Ramalinga Raju was one of the pioneers of the Indian IT industry
A
court in India has found the former head of Satyam Computers and nine
others guilty in one of the country's biggest ever corporate scandals.
B
Ramalinga Raju, who founded the software services giant, denied charges
of conspiracy, cheating and forgery but admitted to accounting
malpractices.
The special court in Hyderabad is expected to pass sentences on Friday.
The collapse of Satyam Computers in 2009 cost shareholders more than $2bn and rocked India's IT industry.
The
BBC's Simon Atkinson in Mumbai says it is the biggest fraud at a listed
company in India - its collapse was called India's Enron.
Satyam was one of the biggest players in the booming Indian software
market. The jobs of 50,000 Satyam workers were only saved after the
government intervened.
Another Indian firm, Tech Mahindra, bought a controlling stake in the company in April 2009.
"All the accused have been convicted of almost all charges," prosecutor K Surender told reporters outside court,
All
10 people accused in the case were convicted - they include two
brothers of Raju and seven others. Raju could face life in prison,
prosecutors say.
Scandal timeline
- January 2009: Raju resigns after admitting Satyam overstated profits for years. Company's stock suspended and government appoints new directors
- February 2009: Federal CBI investigators take over investigation
- November 2011: Supreme Court grants bail to Raju after the CBI fails to file charges in time
- March 2012: Tech Mahindra and Mahindra Satyam announce plans to merge, creating one of India's biggest software companies
- April 2014: Raju and nine others found guilty
'Riding a tiger'
The
scandal emerged in January 2009 when Mr Raju, one of the pioneers in
the Indian IT industry and Satyam's founder and then chairman, confessed
to manipulating his company's accounts and inflating profits over many
years to the tune of about $1.15bn.
In a letter to the board he claimed he had fudged the numbers in order to be in the top four of the Indian IT industry.
"The concern was that poor performance would result in a takeover," he told shareholders.
"It was like riding a tiger, not knowing how to get off without being eaten."
Prosecutors say that when the scam unravelled, it cost shareholders $2.3bn at today's rates.
The scam had been going on for nine years and the confession sent shockwaves across the industry.
Court
papers filed by India's stock market regulator said that Mr Raju along
with 13 other friends and family made about $400m in illegal wealth in
the scam - by cashing in on a surging share price - offloading stakes
in the company at a high price and making substantial profits despite
knowing that accounts were overstated.
Raju was arrested in
January 2009 and jailed before being bailed two years later. He also
spent nearly a year in hospital being treated for hepatitis.
Satyam
had been one of the biggest players in the booming Indian IT software
market, supplying back-office services to firms from around the world,
including General Electric and Qantas Airways.
chanzo:bbcnews
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