CorporateSFIO asked to stop Satyam probe to avoid duplication
However, it will file a chargesheet on company law violations
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The government has asked the Serious Fraud Investigation Office (SFIO) to discontinue its inquiry into the alleged siphoning of funds by Satyam Computer to avoid duplication as the Central Bureau of Investigation (CBI) is also probing if funds were parked abroad by the IT company.
“Now, only the CBI will file a report on the money-siphoning angle in the Satyam case. The SFIO has been asked to discontinue the probe into that matter. We don’t want any duplication. SFIO will file a chargesheet pertaining to company law violations,” a corporate affairs ministry official said.
The ministry had in August asked SFIO, its investigative arm, to probe siphoning of funds by the promoters of Satyam and report within two months.
The decision to ask SFIO to stop probing the money siphoning angle in the accounting fraud was taken by the Coordination Committee on Satyam set up by the ministry to oversee the investigation and ensure that the case reaches its logical conclusion.
The SFIO, which initially probed the scam, has given a 14,000-page preliminary report to the ministry and is required to submit a final report in the case.
The SFIO report mainly dealt with violations of the provisions of the Companies Act.
Another reason for asking SFIO to discontinue the probe was, the MCA official said, because the agency is not empowered to trail funds abroad.
Sources had earlier said the SFIO could seek more time to complete the investigation into the money-siphoning angle, as that would require scrutinising the balance sheets of over 350 companies and 800 bank accounts.
Ever since Satyam founder B Ramalinga Raju confessed to the accounting scam in January this year, there has been suspicion about funds having been shifted overseas.
Although the SFIO had submitted a report in April, sources said this had not been able to track the chain of events leading to diversions of funds.
They said the report did not indicate who the beneficiaries of third-party transactions of about Rs 600 crore are.
Similarly, the end-use of funds raised through the American Depositories Receipts worth $100 million is yet to be detected.
The preliminary report, however, showed violations of various provisions of the Indian Penal Code like criminal breach of trust, forgery and cheating.