India's market regulator has banned international accounting firm Price Waterhouse from auditing listed companies for two years for its role in the country's biggest ever corporate scandals.
The Securities and Exchange Board of India (SEBI) issued the order late Wednesday night after its probe found Price Waterhouse guilty in a decade-old fraud case of over one billion U.S. dollars, involving software firm Satyam Computers, often described as "India's Enron."
"The network structure of operations adopted by the international accounting firm should not be used as a shield to avoid legal implications arising out of the certifications issued under the brand name of the network," the market regulator said in its order.
The fraud came to light nine years back in Satyam Computers, based in the southern city of Hyderabad, when its founder B. Ramalinga Raju confessed to manipulating his company's accounts and inflating profits over many years to the tune of about 1.15 billion U.S. dollars.
And SEBI has found Price Waterhouse guilty of certifying Satyam's fudged accounts from 2000 to 2008 for huge sums of money.
Price Waterhouse has, however, denied any wrongdoing.
"We are disappointed with the findings of the SEBI investigations and the adjudication order. The SEBI order relates to a fraud that took place nearly a decade ago in which we played no part and had no knowledge of," a spokesperson said in a statement to the media.
"As we have said since 2009, there has been no intentional wrongdoing by PW firms in the unprecedented management perpetrated fraud at Satyam, nor have we seen any material evidence to the contrary," the spokesperson added.
Soon after the fraud came to light, Satyam's founder Raju was arrested in January 2009 and jailed before being freed on bail two years later. And in 2015, an Indian court sentenced him and nine others to seven years in prison for his role in the corporate fraud.
The collapse of Satyam Computers in 2009 -- then one of the biggest software giants in India, supplying back-office services to firms from around the world -- cost shareholders more than two billion U.S. dollars and rocked the country's IT industry.
The Securities and Exchange Board of India (SEBI) issued the order late Wednesday night after its probe found Price Waterhouse guilty in a decade-old fraud case of over one billion U.S. dollars, involving software firm Satyam Computers, often described as "India's Enron."
"The network structure of operations adopted by the international accounting firm should not be used as a shield to avoid legal implications arising out of the certifications issued under the brand name of the network," the market regulator said in its order.
The fraud came to light nine years back in Satyam Computers, based in the southern city of Hyderabad, when its founder B. Ramalinga Raju confessed to manipulating his company's accounts and inflating profits over many years to the tune of about 1.15 billion U.S. dollars.
And SEBI has found Price Waterhouse guilty of certifying Satyam's fudged accounts from 2000 to 2008 for huge sums of money.
Price Waterhouse has, however, denied any wrongdoing.
"We are disappointed with the findings of the SEBI investigations and the adjudication order. The SEBI order relates to a fraud that took place nearly a decade ago in which we played no part and had no knowledge of," a spokesperson said in a statement to the media.
"As we have said since 2009, there has been no intentional wrongdoing by PW firms in the unprecedented management perpetrated fraud at Satyam, nor have we seen any material evidence to the contrary," the spokesperson added.
Soon after the fraud came to light, Satyam's founder Raju was arrested in January 2009 and jailed before being freed on bail two years later. And in 2015, an Indian court sentenced him and nine others to seven years in prison for his role in the corporate fraud.
The collapse of Satyam Computers in 2009 -- then one of the biggest software giants in India, supplying back-office services to firms from around the world -- cost shareholders more than two billion U.S. dollars and rocked the country's IT industry.
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