Mumbai: The Institute of Chartered Accountants of India (Icai) team which interrogated Satyam Computer Services Ltd’s former chief financial officer says he had spotted accounting discrepancies and had tendered his resignation twice, before the fraud came to light, but was coaxed by the Raju brothers to stay back.
“An emotional Srinivas Vadlamani began his statement by saying that he was ashamed of himself and wished he had blown the lid off the Satyam scam five years back,” Icai president Uttam Prakash Agarwal told CNBC-TV18. Agarwal led the Icai team that questioned Vadlamani on Sunday at the Chanchalguda jail in Hyderabad.
Vadlamani has been in judicial custody at the jail since 10 January. Satyam founder B. Ramalinga Raju, who confessed on 7 January to having fudged the company’s accounts to the tune of Rs7,136 crore over several years, and his brother and former managing director B. Rama Raju are also in the jail.
“Vadlamani said he tendered his resignation to the Raju brothers on two occasions...but he was coaxed by them to stay back in the interest of the company. In fact, they gave him repeated assurances that the practices being followed were temporary and that the artificial gap created would be met soon,” Agarwal quoted Vadlamani as telling the Icai team.
According to Agarwal, Vadlamani shared in detail with his team the “modus operandi” used by the Raju brothers in inflating sales figures.
“Vadlamani told me that of say 600 clients of Satyam, 30 or 35 parties would be selected, and if the real sale from them amounted to Rs100 crore, the Raju brothers would wrongly show the amount as Rs200 crore,” Agarwal said.
However G. Ramakrishna, one of the senior accounts officers of the company who was arrested late on Sunday following Vadlamani’s interrogation by Icai, said the former chief financial officer had been aware of the fraud and fudging, according to police officers who didn’t want to be named.