Satyam Computer Services chairman Byrraju Ramalinga Raju oversaw a global IT operation before admitting in 2009 to a massive accounting fraud. By falsifying revenue and cash balances by approximately US$1.5 billion, he orchestrated one of the largest corporate scandals in Indian history, leading to his eventual 2015 conviction for orchestrating a complex scheme of financial misrepresentation and record falsification.
Early Ventures and Education
Born in 1954 in Bhimavaram, Ramalinga Raju pursued an academic path in commerce and business management. He earned a Bachelor of Commerce degree from Andhra Loyola College in Vijayawada before traveling to the United States to secure an MBA from Ohio University. Upon returning to India in 1977, he moved through several business sectors, including cotton spinning through a facility funded by the Andhra Pradesh Industrial Development Corporation, and hotel management before pivoting toward the burgeoning real estate and construction industry.
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In 1987, Raju established Satyam Computer Services in Secunderabad alongside his brother-in-law, DVS Raju, starting with 20 employees. The company secured John Deere as its first Fortune 500 client in 1991 and entered public markets in 1992. During the 1990s, Raju attended the Owner/President Management program at Harvard Business School. By 1999, he expanded the firm's reach by launching the internet subsidiary Sify and cultivated close relationships with state political leadership, specifically during the tenure of Chief Minister Chandra Babu Naidu.
Collapse and Confession
The stability of the company faltered following a controversial December 2008 attempt to acquire Maytas Infra Limited. Facing governance pressure, Raju resigned in January 2009, confessing to a multi-year fraud that involved inflating the company’s cash reserves by over ₹7,000 crore. He described the process as an escalating series of lies that became unmanageable as the firm grew. Tech Mahindra later purchased the company, renaming it Mahindra Satyam.
Legal Consequences
Following his resignation, Raju and his brother, B Rama Raju, were arrested by the Andhra Pradesh CID on charges of conspiracy, breach of trust, and falsification of records. Court proceedings lasted several years, involving investigations by the Enforcement Directorate and the Central Bureau of Investigation. In April 2015, a court sentenced Raju and his brothers to seven years in prison and imposed a fine of ₹5.5 crore, though he was granted bail shortly thereafter.
Fast facts
- Born: 1954, Bhimavaram
- Education: Andhra Loyola College, Ohio University, Harvard Business School
- Key Business: Satyam Computer Services
- Confessed Fraud Amount: Approximately US$1.5 billion
- Conviction Date: 9 April 2015
- Sentenced Term: 7 years
Questions readers ask
What was the core mechanism of the Satyam fraud?
Raju admitted to systematically falsifying company revenues, margins, and bank balances, creating over US$1 billion in non-existent cash reserves.
What happened to Satyam after the scandal?
The company was acquired by Tech Mahindra in April 2009 and subsequently rebranded as Mahindra Satyam.
Achievements
- Educated at Harvard Business School and Ohio University
