Mumbai: Satyam Computers chief B Ramalinga Raju’s admission of fraud in the company’s is an “event of horrifying magnitude," the country’s market regulator has said.
"This is an event of horrifying magnitude and it's first of its kind," said C B Bhave, chairperson of the Securities and Exchange Board of India (SEBI). Bhave was speaking after Satyam founder-chairman B Ramalinga Raju resigned from the IT major's board after admitting a multi-crore fraud in the company’s accounts.
"We are in touch with Ministry of Corporate Affairs. We are also in discussion with them as to what steps need to be taken from the perspective of power they have under the law and SEBI has under the law," said Bhave.
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Bewildered by the disclosures made by Raju in his letter to SEBI and the company’s board, , Bhave said it was "most surprising" that cash balance that was non-existent got certified. The case also raises the issue of "authenticity of accounts" that have been audited.
"Our main effort is to see that whatever facts are available with any regulatory agency, those are put out and investors know the truth... I am sure we will have to learn few lessons from this as we get through the facts," he said.
"We are also in touch with stock exchanges to see what will be the appropriate action," he said.
Asked about the action that the company, also listed in New York Stock Exchange, could face in the US, Bhave said: "This is probably not the time when SEC would be available. My guess is that Satyam will have to make similar disclosures there as well. I am not entirely familiar with their law with regard to areas as to what actions they would be taking."