Happy New Year 2009 everybody. For Satyam (SAY) shareholders this new year does not look happy at all. The chairman of the company came out with a confession letter yesterday detailing how he kept the profit books cooked for several years at the company.
It is sad to hear to this and your blood will boil if you happen to be a shareholder of Satyam, either in the Indian markets or the ADS listed on NYSE (SAY).
The auditors (PWC) are definitely getting chastised by many people, but now the board members will also be clearly under scrutiny. More details are emerging too, ranging from missing bank statements, to the real meaning of the insider transactions (sales of shares) in Sep 2008, by top mgmt.
While some say (sorry) that this will tarnish India's shining image of growth and affect outsourcing, I feel that a knee jerk reaction would not last long to affect business with India. What might really happen is a closer scrutiny of the entire business model in India and a consequent improvement in corporate governance and a healthy skepticism at profit bubbles.
What really caught my eye was this phrase from the confession:
"It was like riding a tiger, not knowing how to get off without being eaten" (link to the scanned letter)
There you go, he has himself given suggestions towards the kind of punishment that may be meted out to him. Get a tiger (man-eating or non man-eating, Indian or Siberian), find a forest and then set him on the tiger and of course, track him with a webcam attached to a bird. J/K, but you have to have a small chuckle at the guts of this guy (R. Raju) to in giving analogies when talking about billion dollar losses.
If you want to follow more discussion on SAY, you can visit some popular South Asian blogs - Sepia Mutiny and Indian National Interest.
Showing posts with label scandal. Show all posts
Showing posts with label scandal. Show all posts
Jan 7, 2009
Dec 23, 2008
The Original Ponzi Explained
I read cnn.com regularly, almost everyday and the sensational $50 billion Madoff investment scam had definitely attracted my attention. I had always wondered about who the original Ponzi scheme perpetrator was or how that name came about for that type of fraud.
Only I had been lazy enough that I never bothered to type those few letters into google or wiki and find out for myself. Thankfully, cnn.com ran an article on the original scheme. Once I was done reading that article I got interested in the victims of this fraud, who might have earned some but then eventually lost quite a bit or all of their investment, by the time 2009 arrives.
While glancing through the list, I did a double take when I came across one name : .an individual investor named "Ira Roth".
On my first glance I assumed it was somebody's ROTH IRA investment, but upon reading again I was amazed to see that somebody's name happens to be the same as a tax free retirement vehicle. Granted, Roth does derive its name from a Senator Roth (source), but still it sure was fun to see someone with a first name IRA and last name ROTH.
Only I had been lazy enough that I never bothered to type those few letters into google or wiki and find out for myself. Thankfully, cnn.com ran an article on the original scheme. Once I was done reading that article I got interested in the victims of this fraud, who might have earned some but then eventually lost quite a bit or all of their investment, by the time 2009 arrives.
While glancing through the list, I did a double take when I came across one name : .an individual investor named "Ira Roth".
On my first glance I assumed it was somebody's ROTH IRA investment, but upon reading again I was amazed to see that somebody's name happens to be the same as a tax free retirement vehicle. Granted, Roth does derive its name from a Senator Roth (source), but still it sure was fun to see someone with a first name IRA and last name ROTH.
Nov 8, 2008
AIG Dealings Continue
So the AIG saga is not done yet. With some deft political manoeuvrings, Maurice "Hank" Greenberg is trying to get a sweeter deal for AIG's lifeline from the govt. AIG and its shareholders are trying to get a share of the $700 billion fed money.
This news report from CNN.COM covers the issue in more detail.
To get their share of the bailout money, there has been speculation that AIG was using some of the $85 billion money to continue its lobbying. Of course, AIG officials said they are not using Fed money to lobby. But if they have other money available to do stuff like lobbying, why are they asking for bailout money to begin with. Can somebody please explain this to me? (it is a rhetorical question, do not waste your energy trying explain, there is nothing to be explained there. Chill out.)
AIG common stock definitely jumped up well on Thursday evening and Friday, because as we all know, some people usually get the news before it comes in the newspapers.
This news report from CNN.COM covers the issue in more detail.
To get their share of the bailout money, there has been speculation that AIG was using some of the $85 billion money to continue its lobbying. Of course, AIG officials said they are not using Fed money to lobby. But if they have other money available to do stuff like lobbying, why are they asking for bailout money to begin with. Can somebody please explain this to me? (it is a rhetorical question, do not waste your energy trying explain, there is nothing to be explained there. Chill out.)
AIG common stock definitely jumped up well on Thursday evening and Friday, because as we all know, some people usually get the news before it comes in the newspapers.
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