Local Indian papers are reporting that the founder of disgraced computer company Satyam has surrendered to police custody after the court denied his offer to post bail.
Ramalinga Raju reportedly turned himself in to the Hyderabad authorities, signaling that the sad case of Satyam (SAYCY) is reaching its last phase.
Raju founded the company in 1987, only to admit last January that years of cooking the books had overstated its profits by as much as $1.5 billion over the long term.
Although he received permission to post bail in August, the Indian supreme court recently cancelled that freedom. Now Raju and five other top employees are back in official custody ahead of what will become India’s biggest securities fraud trial ever.
SAYCY was eventually sold to rival Tech Mahindra in a very public auction a few months after the extent of its falsified accounting became clear. Since then, the company has been renamed Mahindra Satyam to indicate its corporate affiliation — and last month the ADR was finally stripped of its NYSE listing, pushing it back onto the pink sheets.
Investors in the company remain understandably bitter, especially since without a NYSE listing, trading their ADR shares is difficult or even practically near-impossible. The only real alternative is an Indian brokerage account, which has its own logistical problems.
Disclosure: no positions