NEW DELHI: Did the market regulator SEBI ignore a red flag over Satyam promoters six years ago, owing to political pressure? The Congress would like to say so, based on Republican Party of India MP Ramdas Athawale’s letter to the then SEBI chairman G N Bajpai claiming that an I-T investigation had discovered a host of benami (anonymous) bank accounts traced to the Satyam Promoters.

The political angle is that SEBI and the government
chose to ignore this report by the I-T department, thanks to Raju’s close links with the then Andhra Pradesh chief minister and key ally of the BJP-led National Democratic Alliance, N Chandrababu Naidu.

ET has learnt that the Mumbai Congress party is gearing up to put the blame on political rival BJP, which was leading the NDA five years ago, for the Satyam scam. This is backed by a letter written to SEBI on August 18, 2003, by parliamentarian Ramdas Athawale based on information provided by a Mumbai-based investor rights activist and chartered accountant Shekhar Vaishnav.

The letter, a copy of which is with ET, said, that the income-tax department, “…found benami bank deposits worth Rs 20 crore in various banks in and around Hyderabad without proper documents and with form 15-H filed for non deduction of TDS on the interest. Finding this odd, IT officials traced the fixed deposits to Stayam promoters and their family members.”

The letter added that on further investigation, “I-T officials saw a possibility of massive manipulation in register of members through various benami accounts, having frequent trading of shares, possibly insider trading, and profits from such trading finding its place in above benami fixed deposits. IT officials had a feeling that promoter holdings in the company through benami holding could be more than those disclosed to various authorities.”

It also alleged that the Satyam executives tried to block the I-T officials from investigating the register of members which has details of all the shareholders of a company.

When contacted by ET, Mr Athawale said that he had raised the issue in the summer session of the Parliament in 2003 and subsequently mailed it to the then PM (Atal Bihari Vajpayee) and the FM (Jaswant Singh) besides the SEBI chief: “Had action been taken then in the BJP regime, we would have been able to curtail the losses we see today,” said the Republican Party of India (RPI) leader. But when ET tried to contact Mr Vaishnav on whose information the letter was sent, he declined to comment on the subject.

Now both Congress and RPI are linking these insider trading allegations to the fudging of financial accounts, as confessed by B Ramalinga Raju last week. In a telephonic conversation with ET last week, Mumbai Congress president Kripashankar Singh said, “We are collecting evidence that the Satyam scam was brought into notice by one of our allies. In spite of that, they chose to ignore the issue because of their own political ambitions. Their follies should come out in public.”

source: Economictimes

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