Abstract

Corporate crimes are frequently committed by several companies to increase their profits by illegal means. One such corporate crime is the Satyam scam. Satyam Computer Services Ltd. was an Indian Information Technology based company situated in Hyderabad, Telangana (formerly in Andhra Pradesh) formed by Ramalinga Raju in 1987. During the year 2009 the company made revenue upto $2.1 billion becoming one of the fastest growing market companies generating and having about 9% market share. After 2009 it came to light that Ramalinga Raju had been falsifying the companies’ data. They had altered the number of sales, earning cash level, providing false financial accomplishment. Ramalinga Raju along with his auditors had forged bank statements, faking invoices and had also inflated customer numbers. This showed the lack in Corporate Governance. Corporate Governance is a system through which a company can be directed and controlled. Corporate Governance helps in determining the aim and value of the company. The Board of Directors of a company are responsible for the governance of the company. Their roles in governance of a company is by appointing of directors and auditors of the company. Since there was no proper governance of Satyam Computer Services Ltd it led to the falsification of the companies accounting for many years since 2003, even though it came to light only by the end of 2008. In this paper we will see in detail about the scam, its aftermath, and the ways in which such scams can be prohibited from happening in the future.

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