Which Indian IT company’s founder confessed to a $1.5 billion accounting fraud in 2009? The company was Satyam Computer Services, commonly called Satyam.
On January 7, 2009, Satyam chairman and founder Byrraju Ramalinga Raju admitted that the company’s accounts had been falsified for years. The fraud involved overstated revenues, profits and cash balances, along with fabricated invoices and other records. The confession shocked India’s technology industry because Satyam had been presented as one of the country’s leading outsourcing companies.
The often-cited $1.5 billion description refers to the broad scale of the accounting manipulation. Raju’s letter described a large gap between the company’s reported financial position and reality, including fictitious cash and bank balances. The scandal also exposed serious failures in corporate oversight and auditing.
Satyam was eventually taken over by Tech Mahindra, and the two companies were later merged. The main mix-up is answering with Raju, the individual who confessed, when the question asks for the company: Satyam.