India’s fraud-hit outsourcing giant Satyam defended itself against police allegations that the scale of its false accounting scandal was far larger than originally believed.
Last week, police said the fraud enmeshing Satyam totalled more than three billion dollars — double the amount suspected when the revelations broke in January.
“Allegations regarding the magnitude of investor harm or historical misstatements in the company’s accounting records do not necessarily shed light on the present financial position and liabilities,” Satyam said late Tuesday.
The statement marked the first detailed response by Mahindra Satyam — as the company is now called — on the deepening scandal.
Satyam founder B. Ramalinga Raju stunned India’s financial world 11 months ago by declaring he had overstated profits for years and inflated the company’s balance sheet.
The Hyderabad-based company, which is defending lawsuits in the US, also reiterated on Tuesday that it could not quantify its potential liability in those lawsuits.
Satyam was ranked as India’s fourth-largest information technology services group by revenues when the scandal broke. Its clients included some of the world’s biggest firms such as Nestle, General Electric and General Motors.
The trial of Raju and other defendants is expected to begin on December 9, according to a report last month in India’s Mint newspaper.
All suspects are in custody in Hyderabad on charges of conspiracy, cheating, forgery and falsification of accounts.
The suspects had allegedly used various methods to swindle money including forging board resolutions to illegally obtain loans, using fake invoices to get money and falsifying other accounts.
In April, Satyam was taken over by the mid-sized Indian computer outsourcer Tech Mahindra, part of leading Indian vehicle maker Mahindra and Mahindra, for nearly 600 million dollars.
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