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8/5/2009
00:29 AM
Bob Evans
Bob Evans
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Satyam Founder's Latest Scam: 2,000 Jobs And $75M

It started off with so much promise: a depressed manufacturing region connects with a global IT powerhouse that commits to reinvigorating the stagnant community with a $75 million high-tech operation that will employ 2,000 people. The fly in the ointment, however, is that the promises were made - and, of course, broken -- by disgraced Satyam founder and chief fraudster B. Ramalinga Raju.

It started off with so much promise: a depressed manufacturing region connects with a global IT powerhouse that commits to reinvigorating the stagnant community with a $75 million high-tech operation that will employ 2,000 people. The fly in the ointment, however, is that the promises were made - and, of course, broken -- by disgraced Satyam founder and chief fraudster B. Ramalinga Raju.The con victims in this case were not corporate customers or accounting firms but rather a local government in Australia near the city of Melbourne, which in return for the commitment from Raju reportedly gave the Satyam founder a huge parcel of land on which the now-mythical sprawling IT facility was to be built along with some seed money as a show of good faith to get things moving.

The Economic Times of India described the setup for the scam this way:

Raju had, last year, promised to invest Australian $75 million in setting up a IT hub at Deakin University's Waurn Pond campus on the outskirts of Geelong, Victoria state's second largest city located 75 kms from Melbourne. A move the Victorian government had hoped would transform Geelong from a decelerating car manufacturing hub into a Silicon Valley by creating 2000 jobs…. Now the Satyam fiasco is already spiralling into a political storm in the port city of Geelong with the ruling Victorian Labor government headed by Premier John Brumby coming under fire.

That's about the end of this latest ugly chapter in the depressing story of Raju's widespread and deeply damaging fraud, which nearly destroyed the jobs of 50,000 people who worked at Satyam, caused significant disruptions at some Satyam clients in the U.S. and other countries, and now reaches into a depressed community in far away corner of Australia that had hoped to combine with Satyam to pull itself into the 21st century.

As has been the case with so much of the mess Raju has left in his wake, about the only thing that's left is a lot of finger-pointing as various partisan Australian officials blame each other in hopes of at least scoring some cheap political points out of an otherwise thoroughly depressing - and, with Raju, all too familiar -- situation.

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