Interestingly enough, Satyam is not the only company based in Hyderabad to have siphoned off investors? money. There are at least 12 firms, though not in the same league as Satyam, which have been recently declared ?vanishing companies?. Although the magnitude of fraud by these companies from Hyderabad is paltry, at around Rs 47 crore, it is not insignificant.

Many ?vanishing companies? had raised money from the market during the capital market boom period, and then simply vanished. By the corporate affairs ministry?s own admission, there are at least 115 vanishing companies, which have failed to file any report on accounts with Sebi for the last two years.

PC Gupta, the Union minister for corporate affairs, in a recent interaction with Express staff, had stated that ?we have identified almost 100 odd companies and prosecuted their directors and promoters, and some of them are behind bars?.

However, there is another huge scandal from the 1990s, when thousands of crore of rupees just vanished as thousands of plantation companies disappeared with investors? money. These plantation companies, through glossy, high profile advertisement campaigns and exaggerated profit projections, managed to attract gullible investors in large numbers.

Most of the 7,983 plantation companies listed on the corporate affairs ministry website have closed down while investors try to recover their hard-earned money. Unfortunately, by the time the government or regulators woke up to this huge fraud in late 1990s, almost all these companies had gone underground with the public?s money. Meanwhile, the corporate affairs ministry website states that a coordination and monitoring committee set up by corporate affairs ministry and Sebi for initiating action against vanishing companies held its 20th and last meeting back on April 23, 2007, almost two years ago. While the various organs of government debate the action to be taken against companies doing the vanishing act, investors suffer silently.

Some action needs to be taken against these firms which will be left untouched by all the investigations into Satyam.

sandip.das@expressindia.com