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CID: Raju inflated employee numbers

N. Rahul

“Only 40,000 were actually working”

HYDERABAD: The Crime Investigation Department (CID) of Andhra Pradesh Police told a court here on Thursday that the former Satyam Computer Services chairman, B. Ramalinga Raju, manipulated records to inflate the strength of the company’s employees to 53,000 when only 40,000 were actually working.

Mr. Raju drew Rs. 20 crore a month from banks to meet what he claimed to be the salaries for the 13,000 non-existing staff, the prosecution argued in the court while seeking extension of the police custody of Mr. Raju and the former Chief Financial Officer, Srinivas Vadlamani.

The prosecution said that in view of the “enormity of the offence” and its “multi-dimensional” nature, the two had to be interrogated. The fraud involved several land and bank transactions, including benami ones, manipulation of records, transfer of shares and fudging of accounts. Insider trading was also not ruled out, Senior Assistant Public Prosecutor K. Ajay Kumar argued.

Referring to the outcome of the four-day custody of the Raju brothers and Mr. Srinivas which ended at 10 a.m. on Thursday, he said Mr. Ramalinga Raju was found to have diverted a huge amount of funds by transferring shares in the names of his brother B. Suryanarayana Raju and mother Appala Narsamma. The value of such diversions was estimated at Rs. 7,400 crore.

Mr. Kumar said the interrogation of Mr. Ramalinga Raju also helped detect purchase of land in 400 benami transactions. One Akula Rajaiah was instrumental in land transactions worth Rs. 125 crore.

Besides, banks confirmed that the company’s accounts reflected fictitious deposits to the tune of Rs. 3,300 crore. Confirmation letters purportedly given to auditors by banks were forged.

The CID wanted to interrogate the accused further to identify persons responsible for the forgery. “We also want to know the identity of the masterminds behind the fictitious cash reserves,” Mr. Kumar said.

The CID possessed a letter from the HDFC Bank’s Basheerbagh branch here, stating that it had not issued the document found on the files of the auditors. Though the police sought custody for two more days, Sixth Additional Chief Metropolitan Magistrate D. Ramakrishna granted only one day till 4 p.m. on Friday.

The former Satyam MD, Rama Raju, was sent back to jail.

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