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World Bank bars Wipro too
Investor confidence shaken, SEBI chief meets PM over Satyam
WSN Bureau
 Bangalore:
Reeling under the impact of the massive fraud perpetrated by
Ramalinga Raju’s team of Satyam Computers, ignored by world renown
auditors Pricewater Cooperhouse, Indian investors and public, today
received another shocker with the World Bank announcing that it had
imposed a four year ban on trade links with another Indian IT giant,
WIPRO Ltd.
The con game of
the Indian IT industry which derives more than 38 percent of its
global revenues from international financial services and employs
directly and indirectly some 2.5 million Indians is likely to take
the entire IT boom downhill, affecting not only the stable growth of
the economy, but also the lives of people as many are likely to be
driven to drastic steps like suicide and other stress related
diseases.
Significantly,
much before the Satyam fraud and its magnitude could be exposed, the
World Bank had banned links with Satyam too.
The World Bank
officials, briefing the media have said that they are black listing
companies “in the interest of fairness and transparency.” "There are
currently three companies that have been debarred along with their
affiliates under the Bank Group's corporate procurement program,"
the Bank said.
It said it
debarred Satyam Computer Services,
India's
fourth-largest software company, for eight years in September 2008,
and Wipro Technologies, India's No. 3 software company, for four
years in June 2007 both for "improper benefits to bank staff".
In addition, it
said it had also barred
India's Megasoft
Consultants for four years in December 2007 for "participating in a
joint venture with Bank staff while conducting business with the
Bank".
Neither the
World Bank, nor the affected companies have so far publicly
acknowledged or made known the ban, which is already in force for
periods of one-two years.
As soon as the
news of the ban was flashed on TV screens and websites, shares in
Wipro fell more than 12 percent though so far, Wipro has denied any
wrong conduct in a statement posted on its Web site.
As part of the
company's initial public offering in 2000 of U.S.-listed shares,
Wipro offered stock to employees and clients including to senior
staff of the World Bank who then made this offer available to family
and friends, it said in the statement.
The company put
up a bold face by discounting the revenues from World Bank, but the
impact on the confidence of investors surely stands shattered. As
inflation goes down and the economy shows signs of stability, the
news from Dalal Street is giving sleepless nights to Prime Minister
Manmohan Singh, who has been briefed by SEBI chief regarding the
impact of the latest financial news involving Satyam and other
companies.
12
January 2009
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