Satyam Chairman and MD Resigns

HappyWheels · 23rd January 2009, 09:26

So this really brings out the knifes now! At first it appeared as a one man's (at least the version that is going around) greed and all that. But now it seems that there is more to this whole fiasco!

This is just out-right fraud done by the people who has access to privileged information and who were calling the shots! I do not think anyone who was in the board can say that they were not aware! If they do so, they are just not fit to be on any board!

Are we seeing the final nails here? There was a report that 3 major customers are going to terminate their contracts with Satyam.

amitoj · 23rd January 2009, 10:24

Quote:

Originally Posted by given2fly

This fake job thing is very much real. Most IT companies are faking their real head count to earn for the heads that they are not using on a project but billing the client for the same (even if they are BS 7799/ISO 27001/blablabla crap certified). Some PMs even make their on bench capacity a part of the project and bill for that resources and the client is only getting a con-job. Have ever heard of Proxy interviews? I heard it for the first time a few weeks back and was astonished and soon the astonishment went away when I came to know that it is a very common practice in Indian ITO orgs.

Agree with given2fly here.
I have personally seen in some of my previous employments ,freshly hired college graduates being passed off as 3+ yr experience employees to clients. And charging the clients accordingly.

DKG · 23rd January 2009, 11:56

Quote:

Originally Posted by w 12

Scamalinga Raju

that's a good one. Now he should write a book : The Art of Scam

sammyboy · 23rd January 2009, 12:25

Quote:

Originally Posted by amitoj

Agree with given2fly here.
I have personally seen in some of my previous employments ,freshly hired college graduates being passed off as 3+ yr experience employees to clients. And charging the clients accordingly.

My wife used to work for one of the MNC's, when she resigned her PM did not upload her resignation on the resignation management system for 3 months as it was his appraisal time and this would have hit his performance. His boss also knew but played along. Needless to say the clients were also billed for 3 months on her name, we got to know this from a colleague of hers.

Spoke to the HR, they said speak to the manager , they cant do anything.
Anyways we let the process go on and she got 3 months of salary while at home

and a full and final settlement with experience letter for more than 3 months later than she left.

kreddy · 23rd January 2009, 12:27

It's certain now that this entire scam was going on for years. Why did Ramalinga Raju confess now? Couldnt he have continued?

rajismine · 23rd January 2009, 13:46

Hey Kreddy,

he did not have cash to pay salaries this month

could not arrange fund personally anymore

markets were down and company had to report earnings

The MAYTAS acquisiton failure along with World Bank statements led to enquiries

Some issues with Merril Lynch

Thus he had to confess under personal stress ....

carboy · 23rd January 2009, 14:14

Quote:

Originally Posted by kreddy

It's certain now that this entire scam was going on for years. Why did Ramalinga Raju confess now? Couldnt he have continued?

The bad economy probably forced his hand. Satyam stock value went down. Maybe Satyam lost a few customers etc. So his cash/assets on hand to
juggle the numbers went down till the point, he couldn't cover it up any
further. Last ditch attempt to continue the scam was the Maytas thing - once that blew up, I suppose he had no options other than to either confess or run away. The 2nd may not have been possible because of family.

DKG · 23rd January 2009, 14:20

Quote:

Originally Posted by kreddy

It's certain now that this entire scam was going on for years. Why did Ramalinga Raju confess now? Couldnt he have continued?

As I understand having milked Satyam bone dry through embezzlement he needed to "on paper" show that all the "non existent" cash reserves are nullified on account of a Maytas purchase.

theMAG · 23rd January 2009, 14:31

Its terrible to see the life-savings of Satyamites getting wiped out. Its only that Satyam got caught out; intentional corporate mis-governance is more widespread in this country than just Satyam's case.

anurag_p80 · 23rd January 2009, 14:34

Why is the stock up 30% today? Does the market know something that we dont?

carboy · 23rd January 2009, 14:40

Quote:

Originally Posted by theMAG

Its terrible to see the life-savings of Satyamites getting wiped out.

This would be only true - if they had kept all their life-savings in Satyam stock.

In the post Enron world, very few people would be doing this.

lambuhere1 · 23rd January 2009, 14:42

Quote:

Originally Posted by anurag_p80

Why is the stock up 30% today? Does the market know something that we dont?

Factoring the fact that the CEO will be selected (or is he already shortlisted ) and there might be new decisions like buyers etc.

Price always factors before the news is out. Wait for a day and you will hear the news, by which time the stock will be out of our bounds

crn12 · 23rd January 2009, 14:44

Quote:

Originally Posted by anurag_p80

Why is the stock up 30% today? Does the market know something that we dont?

It could be that they now have a new CEO!, or there is a company which is really taking over. Other than these two reasons I don't see anything else..

@ rajismine: I guess it wasn't just the pressure from the MAYTAS scam, which unfolded all this truth. I think he is quite smart and is really going in a direction which most of are not sure off...Looks like this whole drama of surrendering & resigning itself is a scam for sure he has something else in his mind...

Do you feel he didn't know that he wouldn't get arrested or this truth would never come out? I think he was aware of this & also knows the consequences and ways to come out clean

ECM · 23rd January 2009, 14:52

New jockey for old horse who is sick and soon going to be out of race of winners!

Quote:

Why is the stock up 30% today? Does the market know something that we dont?

Can we have your more "clear views" on this?

Quote:

Originally Posted by theMAG

Its only that Satyam got caught out; intentional corporate mis-governance is more widespread in this country than just Satyam's case.

w 12 · 23rd January 2009, 14:53

Quote:

Originally Posted by DKG

;11424 Now he should write a book : The Art of Scam

I have a suggestion for the title of this book -
"The story of my experiments with Satyam ( truth ) - Ver 4.20 "

23rd January 2009, 09:26	#406
HappyWheels Senior - BHPian Join Date: Dec 2007 Location: Bangalore Posts: 4,106 Thanked: 537 Times	So this really brings out the knifes now! At first it appeared as a one man's (at least the version that is going around) greed and all that. But now it seems that there is more to this whole fiasco! This is just out-right fraud done by the people who has access to privileged information and who were calling the shots! I do not think anyone who was in the board can say that they were not aware! If they do so, they are just not fit to be on any board! Are we seeing the final nails here? There was a report that 3 major customers are going to terminate their contracts with Satyam.
	() Thanks

23rd January 2009, 12:27	#410
kreddy BHPian Join Date: Oct 2008 Location: Bangalore Posts: 86 Thanked: 36 Times	Why now? It's certain now that this entire scam was going on for years. Why did Ramalinga Raju confess now? Couldnt he have continued?
	() Thanks

23rd January 2009, 13:46	#411
rajismine BHPian Join Date: Sep 2006 Location: Hyderabad Posts: 539 Thanked: 281 Times View My Garage	Hey Kreddy, he did not have cash to pay salaries this month could not arrange fund personally anymore markets were down and company had to report earnings The MAYTAS acquisiton failure along with World Bank statements led to enquiries Some issues with Merril Lynch Thus he had to confess under personal stress ....
	() Thanks

23rd January 2009, 14:31	#414
theMAG Distinguished - BHPian Join Date: May 2006 Location: Avon, CT Posts: 7,217 Thanked: 1,807 Times View My Garage	Its terrible to see the life-savings of Satyamites getting wiped out. Its only that Satyam got caught out; intentional corporate mis-governance is more widespread in this country than just Satyam's case.
	() Thanks

23rd January 2009, 14:34	#415
anurag_p80 BHPian Join Date: Dec 2007 Location: Hyderabad Posts: 314 Thanked: 7 Times	Why is the stock up 30% today? Does the market know something that we dont?
	() Thanks