<div><p>India's fraud office will file charges this month against the founder of outsourcer Satyam after he admitted to falsifying profits in the nation's biggest corporate fraud, a minister said Monday.</p><p>Satyam's founder B. Ramalinga Raju stunned India's financial world in January when he declared he had overstated profits for years and inflated the company's balance sheet by over one billion dollars.</p><p>"During this month, it (the Serious Fraud Investigation Office) will begin prosecution" proceedings, Corporate Affairs Minister Salman Khurshid told reporters in the Indian capital New Delhi.</p><p>The fraud office will prosecute Raju and others under "those areas of company law that it is expected to and has been authorised to proceed with," Kurshid said.</p><p>The Serious Fraud Investigation Office was expected also to prosecute Raju's brother Rama Raju, who was Satyam's former managing director, Vadlamani Srinivas, the ex-chief financial officer, and Price Waterhouse auditors S. Gopalakrishnan and Srinivas Talluri.</p><p>All of the men were placed in custody after the scandal broke at the start of the year embroiling Satyam, a celebrated symbol of India's global outsourcing prowess.</p><p>In April, mid-sized Indian computer outsourcer Tech Mahindra, part of leading Indian vehicle maker Mahindra and Mahindra, paid nearly 600 million dollars for a majority share in the company, rescuing it from collapse.</p><p>Satyam was ranked as India's fourth-largest outsourcer by revenues when the scandal broke and its clients included some of the world's biggest companies such as Nestle, General Electric and General Motors.</p><p>Satyam Computer Services, based in the southern Indian city of Hyderabad, re-branded itself in June as Mahindra Satyam in a bid to recover from the country's worst-ever corporate accounting fraud.</p><p>The Satyam founder underwent emergency treatment at a Hyderabad hospital in September after suffering a suspected heart attack, medical officials said.</p><p>He is still in hospital being treated for cardiac problems and for hepatitis, officials say.</p><p>The fraud office will launch proceedings on about 30 charges, mostly under the Companies Act of 1956, the Press Trust of India reported at the weekend.</p><p>The Central Bureau of Investigation will pursue about half a dozen charges involving criminal offences under the penal code.</p><p>The Serious Fraud Investigation Office is an arm of the Corporate Affairs Ministry.</p><p>Its move to prosecute comes after it submitted reports to the government detailing alleged violations of company law.</p><p>Kurshid said earlier this month his ministry had devised a system under which the government would be able to detect corporate fraud at an early stage.</p><p>Officials would check periodically on revenues and profits. The system would highlight any abnormality in record-keeping, he said.</p><p>Investment house Goldman Sachs has cited "governance" -- both corporate and political -- as the biggest challenge facing India in attaining its economic potential.</p><img src="http://admatch-syndication.mochila.com/images/ad.gif?aid=63525326&bid=informcom" /></div><div id="copyright"><div>

Copyright 2009  <a href="http://www.afp.com/english/links/?pid=copyright">AFP South Asian Edition</a></div></div>