India’s Supreme Court has given the country’s financial markets regulator permission to question Ramalinga Raju, the founder of Satyam Computer Services (SATY.BO), which is at the centre of the country’s biggest corporate scandal, court officials said on Tuesday.
The court said officials from the Securities and Exchange Board of India (SEBI) could interrogate Raju and his brother Rama Raju, Satyam’s (SAY.N) former managing director, for three days from Wednesday, following a petition filed by the regulator.
Satyam’s shares have fallen sharply since mid-December, first on a planned deal to buy related companies and then after Raju quit on Jan. 7, disclosing Satyam’s profits had been overstated for years and around $1 billion in cash on the books did not exist.
Raju was subsequently arrested and Satyam has been fighting to survive with a new government-appointe d board looking to win short-term financing. The software services exporter’s market value has slumped to $800 million from $7 billion in May 2008.
Raju, his brother, and former CFO Vadlamani Srinivas are currently held in a jail in the southern city of Hyderabad, where Satyam was founded more than two decades ago. (Reporting by R.Venkataraman; Editing by Bappa Majumdar & Ian Geoghegan). Courtesy: REUTERS-USA
