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5 years on, the Satyam Computers scam is back in the headlines with the Enforcement Directorate formally seeking prosecution of prime accused B Ramalinga Raju, his kin and 166 companies for money laundering through a web of inter-connected transactions and pledge of inflated shares. The Satyam fraud is being simultaneously investigated by several other agencies as well, including the Central Bureau of Investigation, the SFIO and the income-tax department. But in the interim, Ramalinga Raju its chief architect is roaming free, out on bail, having spent barely 2 years in jail as the investigations continue at a tardy pace.
It is not just Satyam though; perpetrators of some of India’s biggest financial frauds (not including ones involving politicians a.k.a. 2G, Coalgate, CWG, Adarsh etc) continue to roam scot free, years after cases were filed against them, even as countries like the United States have managed to convict and put behind bars fraudsters like Bernie Madoff and others such as Raj Rajanatnam who was accused of insider trading.
Here’s a snapshot of where things stand as far as India’s biggest corporate heists are concerned -
#1 – SATYAM (2009)
Protagonist – B Ramalinga Raju & others
Amount – Rs. 7,200 Cr
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What was it about? –
An accounting scandal where Ramalinga Raju confessed to having cooked up the accounts of Satyam Computers and inflated its bank balances. He has, along with his family members, also been accused of laundering money through a mesh of hundreds of companies.
An accounting scandal where Ramalinga Raju confessed to having cooked up the accounts of Satyam Computers and inflated its bank balances. He has, along with his family members, also been accused of laundering money through a mesh of hundreds of companies.
Status:
Out of jail, on bail! Raju walked out in late November 2011 after spending 32 months behind bars after the CBI failed to charge him on time and the ED delayed launching criminal prosecution because of lack of clarity on which court will hear the matter. Not just Raju, but all the 10 co-conspirators are also out on bail. The CBI is is believed to be nearing completion of the case. But with the ED chargesheet, which includes 37 other individuals apart from the 10 prime accused and 166 companies, just being filed, it could take more time before there is closure to this case.
Out of jail, on bail! Raju walked out in late November 2011 after spending 32 months behind bars after the CBI failed to charge him on time and the ED delayed launching criminal prosecution because of lack of clarity on which court will hear the matter. Not just Raju, but all the 10 co-conspirators are also out on bail. The CBI is is believed to be nearing completion of the case. But with the ED chargesheet, which includes 37 other individuals apart from the 10 prime accused and 166 companies, just being filed, it could take more time before there is closure to this case.
# 2 – KETAN PAREKH SECURITIES SCAM (2001)
Protagonist – Ketan Parekh
Amount – Rs. 1,250 Cr
What was it about? –
Parekh was involved in circular trading and stock manipulation through 1999-2001 in a host of companies. Like his mentor Harshad Mehta, Parekh too borrowed from banks like Global Trust Bank and Madhavpura Mercantile Co-operative bank, and manipulated a host of stocks popularly known as K-10 stocks.
Parekh was involved in circular trading and stock manipulation through 1999-2001 in a host of companies. Like his mentor Harshad Mehta, Parekh too borrowed from banks like Global Trust Bank and Madhavpura Mercantile Co-operative bank, and manipulated a host of stocks popularly known as K-10 stocks.
Status:
Parekh has spent only 1 year in jail but has been banned from trading in the Indian stock markets till 2017. His name though, continues to haunt the street as he has been accused of pulling the strings from the backstage. An IB (Intelligence Bureau) report last year alleged that Parekh and his associates were still engaged in circular and insider trading through front entities, but it was very difficult to establish his complicity because these were largely benami transactions.
Parekh has spent only 1 year in jail but has been banned from trading in the Indian stock markets till 2017. His name though, continues to haunt the street as he has been accused of pulling the strings from the backstage. An IB (Intelligence Bureau) report last year alleged that Parekh and his associates were still engaged in circular and insider trading through front entities, but it was very difficult to establish his complicity because these were largely benami transactions.
# 3 – SPEAK ASIA SCAM (2011)
Protagonists: Harender Kaur, Manoj Kumar Sharma, Tarak Bajpai & others
Amount – Rs. 2000 + Cr
What was it about? –
An online business survey firm that collected thousands of crores of rupees from over 24 lakh investors, asking them to fill surveys and guaranteeing to quadruple their income in one year, Speak Asia was accused of running a Ponzi scheme. A criminal case was registered against the firm in 2011, some accounts frozen and its business shutdown.
An online business survey firm that collected thousands of crores of rupees from over 24 lakh investors, asking them to fill surveys and guaranteeing to quadruple their income in one year, Speak Asia was accused of running a Ponzi scheme. A criminal case was registered against the firm in 2011, some accounts frozen and its business shutdown.
Status:
The Economic Offences Wing (EOW) despite promising to file a watertight case hasn’t yet filed a chargesheet in the case, even with the Bombay High Court rapping it for clubbing all the cheating cases together, leading to a delay. Speak Asia’s panelists have still not been refunded their money (Over Rs 2,000 Cr is due according to some media reports) and its key management personnel are absconding, with no convictions made till date.
The Economic Offences Wing (EOW) despite promising to file a watertight case hasn’t yet filed a chargesheet in the case, even with the Bombay High Court rapping it for clubbing all the cheating cases together, leading to a delay. Speak Asia’s panelists have still not been refunded their money (Over Rs 2,000 Cr is due according to some media reports) and its key management personnel are absconding, with no convictions made till date.
# 4 – HOME TRADE SCAM (2002)
Protagonists – Sanjay Agarwal, Sunil Kedar
Amount – Rs. 600 Cr
What was it about? –
A brokerage embezzling funds from over 25 corporate banks across Maharashtra by luring them with higher interest rates on gilt trading. Investigations revealed that the G-Secs which Home Trade claimed to have bought, were not physically delivered and may not have even existed.
A brokerage embezzling funds from over 25 corporate banks across Maharashtra by luring them with higher interest rates on gilt trading. Investigations revealed that the G-Secs which Home Trade claimed to have bought, were not physically delivered and may not have even existed.
Status:
According to an India Today report Agarwal who was arrested in 2002 is out on bail. The case has been indefinitely delayed due to the accused not turning up for court hearings.
According to an India Today report Agarwal who was arrested in 2002 is out on bail. The case has been indefinitely delayed due to the accused not turning up for court hearings.
#5 - SARADHA CHIT FUND SCAM (April 2013)
Protagonist – Sudipta Sen
Amount – Rs. 2060 – 2400 Cr
What was it about? –
One of the biggest Ponzi schemes in West Bengal that enjoyed political patronage and lured millions of investors to deposit money with the promise of abnormally high returns including fancy holidays etc. The chit fund eventually collapsed leading to defaults after a crackdown by SEBI and the Reserve Bank of India. The default, apart from leaving small depositors high and dry, also led to 10 media outlets owned by Saradha being forced to wind up, leaving 1000 journalists jobless.
One of the biggest Ponzi schemes in West Bengal that enjoyed political patronage and lured millions of investors to deposit money with the promise of abnormally high returns including fancy holidays etc. The chit fund eventually collapsed leading to defaults after a crackdown by SEBI and the Reserve Bank of India. The default, apart from leaving small depositors high and dry, also led to 10 media outlets owned by Saradha being forced to wind up, leaving 1000 journalists jobless.
Status:
Various agencies including ED and SFIO are probing the misappropriation of funds. Sudipto Sen, the Chairman and managing director of the Saradha Group was arrested earlier this year and the Enforcement Directorate has been granted his custody for interrogation to probe money laundering. Suspended TMC MP Kunal Ghosh, who was accused by Sen for being involved in the scam has been called for questioning by SFIO, but not arrested yet. The state had set up a fund of Rs 500 crore for compensating poor depositors. Of Saradha’s 1.7 million investors, only 1000 depositors were indemnified in September and about 1 lakh were expected to be compensated before durga puja.
Various agencies including ED and SFIO are probing the misappropriation of funds. Sudipto Sen, the Chairman and managing director of the Saradha Group was arrested earlier this year and the Enforcement Directorate has been granted his custody for interrogation to probe money laundering. Suspended TMC MP Kunal Ghosh, who was accused by Sen for being involved in the scam has been called for questioning by SFIO, but not arrested yet. The state had set up a fund of Rs 500 crore for compensating poor depositors. Of Saradha’s 1.7 million investors, only 1000 depositors were indemnified in September and about 1 lakh were expected to be compensated before durga puja.
Note: Even as we take stock of the past cases, the probe into the NSEL spot exchange scam is seeing new twists and turns everyday
