Satyam scam: SEBI asks Raju’s family, others to return Rs 1,800 cr

Mumbai, September 10

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SEBI has directed 10 legal entities connected to B Ramalinga Raju, founder and former Chairman of Satyam Computers and the prime accused in a multi-crore fraud case, to return ill-gotten profits of Rs 1,800 crore from the swindle.  Raju’s immediate family — his mother, brother and son — are among those 10 entities mentioned in a recent disgorgement order.

They will also have to pay some Rs 1,500 crore in interest on the amount as penalty with effect from January 7, 2009 — the day Raju admitted to swindling money from investors.

In its latest order, SEBI has given 45 days for the sum to be paid with an interest.

The regulator has also fixed individual liability.

Those against whom the latest order has been passed are SRSR Holdings (a company controlled by Raju brothers  B Ramalinga Raju, Rama Raju and Suryanarayana Raju), IL&FS Engineering and Construction (formerly known as Maytas Infra, controlled by Raju and his two sons Teja Raju and Rama Raju Jr), Raju's mother B Appalanarasamma, his sons, his brother Suryanarayana Raju, B Jhansi Rani (wife of Suryanarayana), Chintalapati Srinivasa (then Director of Satyam) and his father Anjiraju Chintalapati (who is since deceased), as also Chintalapati Holdings Pvt Ltd.

The latest penalties for insider trading comes more than a year after the regulator, in another disgorgement order, had forbidden Raju and four others — his brother B Rama Raju (former Managing Director of Satyam), Vadlamani Srinivas (former Chief Finance Officer), G Ramakrishna (former Vice-President) and VS Prabhakara Gupta (former Head of Internal Audit) — from trading in the markets for 14 years. The order had also asked all return unlawful gains of Rs 1,849 crore with interest.

IL&FS Engineering and Construction (IECCL) was spared of debarment action after the SEBI found it was neither an insider in Satyam Computers and Maytas, nor did it have access to the 'unpublished price sensitive information'.

On January 7, 2009, Raju, then Chairman of Satyam Computer, had sent an email to SEBI admitting that he had inflated inflating cash and bank balances of the company and understating its liabilities and other financial misstatements.

The Central Government then ordered sale of what was then the country's fourth largest IT firm.

Tech Mahindra acquired the company, which was then renamed as Mahindra Satyam. It later merged with Tech Mahindra. — PTI