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Govt to refer Satyam case to probe agency

January 07, 2009 13:40 IST
Last Updated: January 07, 2009 17:23 IST

The government said on Wednesday it would refer the case of financial bungling by Satyam Computer Services [Get Quote] to Serious Fraud Investigation Office after verifying the facts and stern action under the law will be taken, if facts are correct.

"Case will be referred to SFIO once facts are verified. If they (facts) are genuine then it (the development) is shameful," corporate affairs minister P C Gupta told reporters.

He said if facts regarding financial wrong-doing by Satyam are found correct, stern action will be taken as per the law.

Gupta also said his ministry is in constant touch with the market regulator Securities and Exchange Board of India and a coordinated action with the watchdog will be taken. 

Gupta said the role of auditors and directors in the Satyam case has to be verified.

Earlier, a top MCA official said that apex institutions of chartered accounts and company secretaries, ICAI and ICSI, will also be directed to look into the role of directors and auditors.

"If prima facie (a) case is found then (the) disciplinary board of these institutions will be asked to take actions against auditors and directors and prosecution will be launched certainly," the MCA official said.

Gupta said, "It is a complex issue. We have to see that communication (in this regard) is from genuine sources."

Meanwhile, Sebi chairman C B Bhave said, "We are in touch with (the) ministry of corporate affairs. . .we are also in discussion with them as to what steps need to be taken from the  perspective of power they have under the law and Sebi has under the law".

Bhave said the development would have serious implications for the market. Jurisdictions in this case lie with various authorities and accordingly, "We are in touch with (the) ministry of corporate affairs for coordinated action," he added.

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