As it is unlikely B Ramalinga Raju, founder and former chairman of erstwhile Satyam Computer Services, along with four other executives of the erstwhile firm, will be able to cough up the Securities and Exchange Board of India (Sebi)’s penalty of Rs 3,000 crore, the five might go for an appeal against the order.
If the former Satyam executives fail to pay the penalty within 45 days, Sebi’s enforcement department will step in. The department is empowered to attach the commercial and personal properties of the executives.
“If the process fails to recover the entire quantum of penalty, Sebi could look at prosecuting the individuals,” said an official.
The Satyam executives, however, could approach the Securities Appellant Tribunal and seek the Sebi order be quashed or stayed.
Sources in the Kshatriya community, to which Raju belongs, said, “As far as we know, the value of the assets Raju and his immediate family hold doesn’t exceed Rs 300 crore. Since most of their properties have already been attached by the ED (Enforcement Directorate) and other agencies, it will be difficult for them to pay the hefty penalty imposed by Sebi.”
They added Raju also owned small plots of agricultural land in Garagaparru (his paternal grandparents’ village) and Jallikakinada (maternal grandparents’ village) in West Godavari district of Andhra Pradesh. However, all these together wouldn’t fetch more than Rs 25 crore (book value).
Reportedly, Raju and his sons now run a real estate business in Latin America. These assets, it is estimated, are worth about Rs 200 crore.
Efforts to ascertain the details of the other three Satyam executives (excluding Ramalinga Raju and his brother Rama Raju)---Vadlamani Srinivas, former chief financial officer; G Ramakrishna, former vice-president (finance); and VS Prabhakara Gupta, former head (internal audit---proved futile.
Sandeep Parekh, former executive director of Sebi, said, “It is more of a legal victory than a practical one. Sebi will find it difficult to recover the penalty, as by way of assets, there isn’t much to attach. The majority of the assets of Satyam executives has already been attached by various investigative agencies, including the CBI (Central Bureau of Investigation), ED and the income tax.”
