Ramalinga Raju

Byrraju Ramalinga Raju (born 16

September 1954) is an Indian
businessman. He is the founder of Satyam
Computer Services and served as its
chairman and CEO from 1987 until 2009.
Raju stepped down following his
admission to embezzlement from the
company to the tune of ₹7,136 crores
(approximately US$1.5 billion),[1] including
₹5040 crores (approximately US$1 billion)
of non-existent cash and bank
balances.[2][3] In 2015, he was convicted of
corporate fraud, which led to the collapse
of Satyam Computers.
 Ramalinga Raju

Born Byrraju Ramalinga

Raju
16 September 1954
Bhimavaram, Andhra
State (present-day
Andhra Pradesh),
India

Occupation Businessman YPS22

Known for Founder and former
Chairman of Satyam
Computer Services

Criminal penalty Convicted to 7 years

prison

Criminal status In Jail

Spouse Nandhini (m. 1976)

Children 2 (Teja Raju, Rama

Raju)

Website http://ypcs.ml/

Early life
Ramalinga Raju, the eldest of Four
children, was born on 16 September
1954.[4][5] He earned a Bachelor of
Commerce degree from Andhra Loyola
College at Vijayawada and subsequently
earned an MBA from Ohio University in the
United States.[6] After returning to India in
1977, Raju married at the age of twenty
two. He ventured into many businesses
including Dhanunjaya Hotels; and a cotton
spinning mill named Sri Satyam Spinning,
funded by Andhra Pradesh Industrial
Development Corporation (APIDC), with an
investment of ₹ 9 crore (worth almost $7
million in 1983 prices). As the businesses
failed Raju moved into real estate and
started a construction company named
Maytas Infra Limited.[6][7]
Family
Ramalinga Raju is married to Nandini and
the couple had two children Teja Raju, and
Rama Raju. Teja Raju is married to Divya, a
Bharatanatyam dancer.[8] Younger son
Ramaraju married Sandhya Raju, daughter
of P. R. Venkatarama Raju, managing
director of Ramco Cements.[9]

Career
In 1987, Raju incubated Satyam Computer
Services along with one of his brothers-in-
law, DVS Raju at P&T colony in
Secunderabad and 20 employees. In 1991,
Satyam won its first fortune 500 client –
John Deere. Raju navigated Indian
bureaucracy to obtain the required
clearance to transmit data from India. The
company went public in 1992. Raju was
enrolled in the Owner/President
Management (OPM) program at Harvard
Business School in the 1990s.[10] In an
interview with Deccan Chronicle way back
in 1998, Raju was talking about Satyam's
ambition of operating out of 50 countries
with an employee count of more than
50,000. In 1999, Raju launched Satyam
Infoway (Sify) as Satyam's internet
subsidiary, thereby becoming an early
participant in the Indian internet service
market.[6] Sify was later sold to Raju
Vegesna.

Business and politics

In September 1995, as Raju was building
Satyam, Andhra Pradesh had a new Chief
Minister, Chandra Babu Naidu, who wanted
to bring in change. Naidu saw IT as a
strategic industry to focus on and Raju
became instrumental in shaping the
state's information technology initiatives
like 'Mee Kosam' ("For you" in Telugu). Raju
had unfettered access to the chief Minister
of Andhra Pradesh at a very personal level.
Research into his life has exposed close
links between business and politics.[11]
Philanthropy
The major philanthropic foundations he
has founded and grown to large scale
between 2000 and 2008 are:

Byrraju Foundation:

The Byrraju Foundation, a family run

philanthropic organization, was started in
July 2001 by him and his 2 brothers in the
memory of his father Late Byrraju
Satyanarayana Raju. The Foundation
adopted 200 villages in 6 districts of
Andhra Pradesh namely East Godavari,
West Godavari, Krishna, Guntur, Ranga
Reddy and Visakhapatnam. The
foundation built progressive self-reliant
rural communities by adopting a holistic
approach. It provided 40 different
programs like healthcare, environment
improvement, sanitation, primary
education, adult literacy and skills
development .,[12][13] GramIT etc. which
impacted over 3 million people. Some
significant achievements of the foundation
are: Over 7 million patient visits, 53,250
persons made literate, 89,000 toilets built
in rural homes, Livelihood skill training and
certification for over 26,000 unemployed
rural youth, setting up 61 drinking water
plants and 4 GramIT Centres which
employed 500 rural youth.
Currently, after the Satyam episode, the
foundation has 117 adopted villages
where it runs 110 health centers with the
help of CARE foundation and operates 18
water plants.

The local people across the region hail the

development works undertaken by the
Byrraju Foundation and are appreciative of
the positive impact it had on them.[14]

Emergency Management and Research

Institute (EMRI 108):

Raju also set up a state of the art and first

of its kind 24X7 emergency service named
Emergency Management and Research
Institute (EMRI 108) in August 2005. It was
modelled after the 911 service in America
and had an aim of giving citizens in an
emergency the benefit of getting timely
attention and support. This was done by
providing a single toll-free number
accessible from mobile and land line.
Recently Forbs magazine has published an
Article about the "Emergency Management
System in US" (see in the External Link
below).

Initially started with just 75 ambulances,

EMRI has currently expanded to 10,697
ambulances covering 15 states and 2
union territories, serving over 26,710
emergencies per day, covering a
population of 75 Crores (increasing reach
of health care in rural, hilly & tribal areas).
EMRI has more than 45,000 employees on
its rolls. Till date 4.7 crore beneficiaries
have availed these services, 4.38 lakh
deliveries were assisted, and 18.56 lakh
lives were saved since inception.

All the call-centre activities and support

activities for emergency handling were
automated. While state Governments were
providing most of the funding, EMRI part
funded and managed the services in PPP
mode. After the Satyam episode, Raju
resigned from the Board of Directors. The
GVK group then took responsibility to run
the institute. It now runs as a free service
as a very successful public private
partnership (PPP) model.

HMRI 104:

Raju was instrumental in launching a

public private partnership (PPP) model
between Satyam and The Government of
Andhra Pradesh in 2007, termed as Health
Management and Research Institute
(HMRI 104). Before its launch, Andhra
Pradesh faced a massive shortage in
Primary Healthcare Centres (PHC) and
Community Healthcare Centres (CHC).
This resulted in a stressed public
healthcare system in the state which
meant lower quality care for its citizens.
By providing a helpline for all types of
health-related queries and telemedicine,
HMRI was able to lessen the burden on the
public health system.

The program was aimed at the rural poor

who had little to no access to qualified
doctors and healthcare information. It also
constituted a training program for
Registered Medical Practitioners (RMPs)
and ran mobile health clinics.
Naandi Foundation: in 1998, the Naandi
foundation was set up by the then CM of
Andhra Pradesh Mr. N. Chandrababu
Naidu, along with the heads of the 4 major
business houses in the state: Dr K. Anji
Reddy - Dr Reddy's Labs, Mr. Ramesh Gelli
- founder of Global Trust Bank, Mr. B.
Ramalinga Raju – Chairman of Satyam
Computer Services, and Mr. K. S. Raju-
Chairman of the Nagarjuna group of
companies.

The aim of the foundation was to increase

literacy among the poor and marginalized
sections of society by increasing their
enrollment in primary school. The students
were also provided 1 full meal during the
day. The foundation was able to reach 880
schools in the twin cities of Hyderabad
and Secunderabad and feed 150000
children daily.

Accounting scandal
Raju resigned from the Satyam board after
Satyam Scandal, admitting to falsifying
revenues, margins and over ₹5,000 crore
of cash balances at the company. The
Indian affiliate of
PricewaterhouseCoopers, the company's
auditors, appears to have certified the
company had $1.1 Billion in cash when the
real number was $78 million.[15]
Just a few months before the scandal
broke out, Raju tried to persuade investors
by claiming that the company is sound and
that past October he surprised analysts
with better-than-expected results, claiming
that "the company had achieved this in a
challenging global macroeconomic
environment, and amidst the volatile
currency scenario that became reality"[16]

A botched acquisition attempt involving

Maytas in December 2008 led to corporate
governance concerns among Indian
investors and plunge in the share price of
Satyam.[17] In January 2009, Raju indicated
that Satyam's accounts had been falsified
over a number of years.[17] Total assets on
Satyam's balance sheet tripled during
2003–07 to $2.2 billion.[18] He confessed
to an accounting fraud to the tune of
₹7,000 crore or $1.5 billion and resigned
from the Satyam board on 7 January
2009.[19][20] Satyam was purchased by
Tech Mahindra in April 2009 and renamed
Mahindra Satyam.[21]

In his letter, Raju explained his modus

operandi to something that started as a
single lie but led to another as "What
started as a marginal gap between actual
operating profit and the one reflected in
the books continued to grow over the
years. It has attained unmanageable
proportions as the size of the company's
operations grew over the years.".[16] Raju
described how an initial cover-up for a
poor quarterly performance escalated: "It
was like riding a tiger, not knowing how to
get off without being eaten."[22]

Raju and his brother, B Rama Raju, were

then arrested by the CID Andhra Pradesh
police headed by V S K Kaumudi, IPS on
charges of breach of trust, conspiracy,
cheating, falsification of records. Raju may
face life imprisonment if convicted of
misleading investors.[23] Raju had also
used dummy accounts to trade in
Satyam's shares, violating the insider
trading norm.[24]

The Government of Andhra Pradesh

attached 44 properties belonging to the
family members of the promoters of
Satyam Computers in the case against
Raju.[25]

It has now been alleged that these

accounts may have been the means of
siphoning off the missing funds.[26] Raju
has admitted to overstating the company's
cash reserves by USD$ 1.5 billion.[26][27]
Raju was hospitalized in September 2009
following a minor heart attack and
underwent angioplasty. Raju was granted
bail on condition that he should report to
the local police station once a day and that
he should not attempt to tamper with the
current evidence. This bail was revoked on
26 October 2010 by the Supreme Court of
India and he has been ordered to surrender
by 8 November 2010.[28]

Court proceedings
In November 2010, Raju surrendered after
the Supreme Court in August cancelled the
bail granted to him by a lower court in
Hyderabad, where Satyam is based.
The Supreme Court on 4 November 2011
granted bail to Raju since the Central
Bureau of Investigation (CBI) failed to file
charges on time. According to Indian law,
if a chargesheet is not filed within 90 days,
then the accused person has a right to
obtain Default Bail.[21]

On 28 October 2013, the Enforcement

directorate filed a chargesheet against
Raju and 212 others. The filed report
states that "it transpires that the accused
resorted to inter-connected transactions,
so as to ensure that crime proceeds were
distanced from its initial beneficiaries, and
laundered the said proceeds under the
cover of the corporate veil, with an ulterior
motive to project the properties so
acquired as untainted ones". [29]

On 9 April 2015, Ramalinga Raju and his

brothers were sentenced to 7 years in jail,
fined ₹5.5 crore. [30]

On 11 May 2015, within a month of being

convicted, Ramalinga Raju and all others
who were found guilty were granted bail by
a special court in Hyderabad. The bail
amount for R. Raju and his brother was set
at ₹10,00,000 and the other convicts was
set at ₹50,000 only.[31]
On 10 January 2018 India's capital market
regulator has banned global auditing firm
Price Waterhouse (PW) from auditing
listed companies in India for two years for
its alleged role of collusion with the
directors and employees of erstwhile
Satyam Computer Services, in perpetrating
the country's biggest corporate accounting
scandal.[32]

In popular culture
Bad Boy Billionaires: India - 2020 Netflix
original documentary anthology
webseries[33]

Untitled SonyLIV Telugu-Hindi bilingual

web series based on his personal life
 from the book The Double Life of
Ramalinga Raju.[34]

References
1. 1 Billion equals to 100 crores in Indian
rupees

2. "Satyam's chairman Ramalinga Raju

resigns, admits fraud" (http://timesofindia.
indiatimes.com/business/india-business/
Satyams-chairman-Ramalinga-Raju-resign
s-admits-fraud/articleshow/3946088.cm
s) . The Times of India. 7 January 2009.
Retrieved 20 October 2013.
3. Rs 7,000-crore fraud (http://www.thehindu
businessline.com/todays-paper/rs-7000cr
ore-fraud/article1039285.ece) . The Hindu
Business Line. Retrieved on 27 December
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4. "CASTE IN STONE" (https://bangaloremirr

or.indiatimes.com/opinion/sunday-read/c
aste-in-stone/articleshow/22248191.cm
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5. Reporter, B. S. (7 January 2014). "What is

Raju doing now?" (https://www.business-s
tandard.com/article/companies/what-is-r
aju-doing-now-114010700018_1.html) .
Business Standard India. Retrieved
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6. Anjum, Zafar (10 October 2012). The
Resurgence of Satyam: The Global IT
Giant (https://books.google.com/books?id
=xYchAda6GGcC&pg=PA2011) . Random
House India. p. 1990. ISBN 978-81-8400-
340-6.

7. "Business News Today: Read Latest

Business news, India Business News Live,
Share Market & Economy News" (https://e
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8. Dey, Dasarath Reddy & Sudipto (5 January
2019). "10 years after Satyam, Raju
remains patriarch of family-run business
empire" (https://www.business-standard.c
om/article/current-affairs/10-years-after-s
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9. "Ramalinga Raju's family gets back into

business" (https://www.businesstoday.in/l
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mily-gets-back-into-business-52619-2015-
08-20) . Business Today. Retrieved
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10. Matthew Fox. "Satyam's Aversion to
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man.utoronto.ca/integrativethinking/RRaj
u.pdf) (PDF). Rotman Magazine.
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11. Bhandari, Bhupesh (2009). The Satyam

Saga (https://books.google.com/books?id
=oQOF7tkWXjIC&pg=PA92) . Business
Standard Books. p. 92. ISBN 978-81-
905735-7-3.

12. Raju, V.S. Byrraju Foundation is Initiatives

and Experiences in Rural Villages (http://w
ww.iisc.ernet.in/centenary-conf/Prof_V_S_
Raju.pdf) . Byrraju Foundation
13. Impact Investments (http://www.rockefell
erfoundation.org/uploads/files/2b053b2b-
8feb-46ea-adbd-f89068d59785-impact.pd
f) . J.P. Morgan. 29 November 2010

14. "Ramalinga Raju's village still blesses him"

(http://www.indianexpress.com/news/ram
alinga-rajus-village-still-blesses-him/4087
25/) . The Indian Express. 9 January 2009.
Retrieved 13 April 2011.

15. Norris, Floyd (7 January 2009) A

Corporate Hero Admits Fraud (https://eco
nomix.blogs.nytimes.com/2009/01/07/a-
corporate-hero-admits-fraud/?ref=worldbu
siness) . New York Times
16. Timmons, Heather and Wassener, Betina
(7 January 2009) Satyam Chief Admits
Huge Fraud (https://www.nytimes.com/20
09/01/08/business/worldbusiness/08saty
am.html?_r=0) . New York Times

17. Joe Leahy (8 January 2009). "The $1bn

black hole at the heart of company's
finances" (https://www.ft.com/cms/s/0/2
4e4d8d4-dcf1-11dd-a2a9-000077b07658.
html) . Financial Times.

18. Satyam's balance sheet tripled within 4

years (http://www.concernedshareholder
s.com/SAMPLE_HAv2.3_SAY.pdf)
19. Blakely, Rhys (8 January 2009). "B.
Ramalinga Raju, chairman of Satyam,
admits £1bn fraud and quits" (http://busin
ess.timesonline.co.uk/tol/business/indust
ry_sectors/technology/article5469536.ec
e) . The Times (London). News
International Limited. Retrieved 8 January
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20. "Mr Raju's resignation letter" (http://news.

bbc.co.uk/1/shared/bsp/hi/pdfs/07.01.09
_ramalingarajuletter.pdf) (PDF). BBC
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21. "Section 167 of the Code of Criminal
Procedure, 1973" (https://www.scconline.
com/blog/post/tag/section-1672-crpc/) .
Eastern Book Company. 16 November
2020. Retrieved 16 November 2020.

22. "Satyam stunner: Highs and lows of Raju's

career" (https://web.archive.org/web/200
90923213724/http://ibnlive.in.com/news/
satyam-stunner-highs-and-lows-of-rajus-c
areer/82183-7.html?from=rssfeed) . CNN-
IBN. Reuters. 7 January 2009. Archived
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s-career/82183-7.html?from=rssfeed) on
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23. Blakely, Rhys (10 January 2009). "Raju
brothers charged with forgery in $1bn
Satyam case" (http://business.timesonlin
e.co.uk/tol/business/industry_sectors/tec
hnology/article5485034.ece) . The Times
(London). News International Limited.
Retrieved 10 January 2009.

24. "Raju had opened multiple benami

accounts: I-T probe" (https://web.archive.o
rg/web/20090122215644/http://www.ndt
v.com/convergence/ndtv/story.aspx?id=N
EWEN20090079818) . NDTV. NDTV.
Archived from the original (http://www.ndt
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EWEN20090079818) on 22 January
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25. Satyam case: Properties of promoter's
family attached | Business Line (http://ww
w.thehindubusinessline.com/industry-and-
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s-of-promoters-family-attached/article350
1627.ece) . Thehindubusinessline.com (7
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26. Timmons, Heather (17 January 2009)

"Indian Executive Is Said to Have Siphoned
Cash" (https://www.nytimes.com/2009/0
1/18/business/worldbusiness/18india.ht
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ews.bbc.co.uk/1/hi/business/7821087.st
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28. "Satyam boss Raju's bail cancelled" (http
s://www.bbc.co.uk/news/world-south-asia
-11628029) . BBC News. 26 October 2010.

29. ED files complaint of money-laundering

against Satyam accused (http://www.thehi
ndu.com/business/Industry/raju-212-othe
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281587.ece?homepage=true) . The Hindu
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30. [1] (http://www.thehindu.com/business/all

-10-accused-found-guilty-in-satyam-case/
article7084538.ece) . The Hindu (10 April
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31. "Satyam's Ramalinga Raju, 9 others get
bail, sentences suspended by court -
Times of India" (http://timesofindia.indiati
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235993.cms) . The Times of India.

32. "Price Waterhouse gets 2-year ban in

Satyam case" (http://economictimes.india
times.com/articleshow/62452514.cms) .
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33. "Bad Boy Billionaires India trailer: An in-
depth look at the controversial cases of
Vijay Mallya, Nirav Modi and others" (http
s://indianexpress.com/article/entertainme
nt/web-series/bad-boy-billionaires-india-vij
ay-mallya-nirav-modi-scam-corruption-vide
o-6569145/) . The Indian Express. 25
August 2020. Retrieved 11 February 2021.

34. "Nagesh Kukunoor to direct web series on

Satyam CEO Ramalinga Raju" (https://ww
w.indiatoday.in/binge-watch/story/nagesh
-kukunoor-to-direct-web-series-on-satyam-
ceo-ramalinga-raju-1768163-2021-02-11) .
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External links
https://www.forbes.com/sites/williamha
seltine/2019/01/23/what-the-u-s-can-
learn-from-indias-emergency-response-
system/#435914e3b274

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