Sebi to meet Raju today

Written by Markets Bureau | Mumbai | Updated: Jan 11 2009, 03:43am hrs
The Securities and Exchange Board of India (Sebi) has started tightening the noose around Satyam Computers Ltd. A team of Sebi will interrogate B Ramalinga Raju, the company's former chairman, in Hyderabad on Saturday on how the books of account of the company were fudged, said CB Bhave, chairman, Sebi.

On the sidelines of a seminar on integrity at work in financial services, organised by Securities Investment Institute (SII) at the Bombay Stock Exchange (BSE), CB Bhave said that a team is already in Hyderabad and they met senior officials and the CFO of Satyam on Friday. "I have learnt that they will meet Ramalinga Raju tomorrow," he said.

He said that the Sebi committee has met and decided that the working papers, which auditors took as their basis, will be subjected to peer review by another auditor.

The books of the accounts of the last quarter of the calendar year 2008 ending December 2008, and those of the financial year 2007-08 will be scrutinised by a peer auditing firm. Sebi will constitute a panel of auditors, and the auditor will be chosen from it.

Sebi wants to assure everyone that Satyam is a one-off event. "We want to remove the fear from the minds of the investors," he said. A panel of auditors will be prepared by January 31, 2008. "And the peer auditor or committee will give the report in one month," he said. In reply to a question, Bhave said that Sebi will not send any team to the US as we have already an MoU with the US regulator. "As per the MoU, both regulators can share information with each other on the common entity, which has done anything wrong in both the jurisdictions," he said.

Sebi chairman said that action can be taken against Satyam on three counts. One, the registrar of companies (RoC) can take action under the Companies Act. Secondly, Sebi can take action under the Sebi Act and then the investigation agency can take action under IPC.

On whetehr PwC will be a part of the panel of auditors, Bhave said that the regulator is investigating the case and it will not be proper to comment on the issue.