Indian Media Sees Overly Kind Treatment of Ex-Chairman
The Hindu today reported that former Satyam Chairman Ramalinga Raju has been treated with "white gloves". Specifically, the former executive has been given a very different treatment than that encountered by another famous Indian executive involved in a less spectacular situation. The article paints a picture of Indian justice that will not be looked upon well by Western press, business leaders and governments. For a person who has admitted his role in one of the biggest frauds in Indian history, Mr. Raju appears to be well taken care of by Indian officials.
In another piece that The Hindu published, there is speculation that Mr. Raju's arrest was timed so that it would prevent authorities from India's equivalent of the Securities and Exchange Commission from interviewing him. If this is true, it would further point to an effort by Indian authorities to protect Mr. Raju and/or contain this scandal from gaining additional negative publicity.
What the Indian government should do is:
- decide if it wants to save Satyam as a business or not. If it does, give it a loan that permits management to make payroll for the next 3-6 months. In that time frame, the government should insist on the sale of the company and a subsequent repayment of the loan.
- get an absolutely impartial and independent group of examiners (including forensic accountants) to investigate the fraud. The entire investigation should be open and the results published for the world to see.
- punish Mr. Raju and his potential co-conspirators to the fullest extent possible under Indian law. If India is unwilling to do so, the U.S. certainly has the laws and Federal prosecutors who are up to the challenge.
If India chooses to pretend like this didn't happen or wish to sweep the whole matter under the rug, this will severely damage its ability to attract new business to the country. If people can perpetrate such frauds with little or no consequence, then what sane firm would risk its capital in such a place?
Why might India not pursue this matter vigorously? There may be many Indian politicians who owe their political success to the campaign contributions and/or connections to Satyam and the people who founded it. They may not want anyone looking too close to the monies that have moved through Satyam as some uncomfortable connections or dealings may become public. That's just a guess but it bears watching.
Will real change emerge? My channel checks are giving me reason to think not. Your thoughts?