Hyderabad:
Two days after shocking the country by admitting to Rs 7,800-crore fraud, Satyam founder Ramalinga Raju and his brother Ram Raju were arrested on Friday night as part of the crackdown by state authorities and the central government, which disbanded the tainted IT firm's board on a day of fast-paced developments.
Fifty four-year-old Raju, who stepped down as Chairman after admitting to the fraud on Wednesday, and Rama Raju, who resigned as CEO and MD of the company, were arrested by the police on charges of criminal conspiracy, cheating, forgery, misappropriation of funds and criminal breach of trust.
(Watch)The police questioned the two brothers, Director General of Police S S P Yadav said that the company's Chief Financial Officer Valdamani Srinivasan would be arrested on Saturday.
The police action, which could lead to Raju getting imprisonment of up to 10 years, along with monetary penalties, came within hours of the Central Government disbanding the board on the eve of its scheduled meeting. He has been charged under Section 120B, 409, 420, 468, 471 of the IPC. These sections pertain to criminal conspiracy, criminal breach of trust, cheating, forgery and using forged documents as genuine.
IG CID VSK Kaumudi told reporters outside the DGP's office that Ramalinga Raju would be produced before the SEBI investigators on Saturday if they make a request.
Corporate Affairs Minister Prem Chand Gupta announced that 10 directors would nominated to the new board, which would meet within a week.
When contacted, Satyam spokesperson declined to comment on reports of Raju's surrender.
Raju, whose whereabouts were a matter of speculation ever since he made the startling disclosure on Wednesday about the Rs 7,800 crore financial fraud, had been in hiding and was summoned to appear before the SEBI on Saturday.
Earlier this evening, the government disbanded the current board of Satyam Computer and announced that it would nominate 10 directors on its board.
Corporate Affairs Minister Prem Chand Gupta said in New Delhi that the names of the new members would be announced soon for the board, which would meet in the next seven days.
The existing board of the company was scheduled to meet on Saturday to discuss the crisis that has engulfed the company and its over 50,000 employees.
Meanwhile, Satyam Computer Services has welcomed the government's decision to appoint 10 nominees as directors of the company to replace the current board.