CBN Is Most Wanted Criminal For CBI Says Laxmi Parvathi

Posted on 14 November 2011

CBN Is Most Wanted Criminal For CBI Says Laxmi Parvathi

CBN is Most wanted Criminal for CBI Says Laxmi Parvathi_telugutouch.com

CBN Is Most Wanted Criminal For CBI Says Laxmi Parvathi

CBN Is Most Wanted Criminal For CBI Says Laxmi Parvathi

Prominent auditing firm Deloitte Touche Tohmatsu India Private Limited has admitted before the Central Bureau of Investigation (CBI) that it had fudged the accounts of Jagathi Publications, the media house owned by YSR Congress Party president Y. S. Jaganmohan Reddy, to help him sell the shares of his company to high-profile investors at a huge premium of Rs. 350 for a share of Rs. 10.

On Wednesday, Deloitte senior director P. N. Sudarshan admitted before the CBI that he had jacked up the value of Jagathi Publications by Rs. 1,000 crore – from Rs. 2,500 crore to Rs. 3,500 crore – for its five-year business plan period at the request of the company’s vice-chairman and Jagan’s personal auditor V. Vijay Sai Reddy in April 2008.

This is the second instance of a multinational audit firm fudging the account books of a company in recent times. Over two years ago, another multinational audit company – PricewaterhouseCoopers (PwC), India – had cooked the account books of Satyam Computer Services in an estimated fraud of Rs. 14,000 crore.

Ironically, the actual value of Jagathi Publications, as assessed by Chennai-based auditor J. Prabhakar of Jagadeesan & Company in July 2007 was just Rs. 196 crore. And the company, which was projected to grow into Rs. 3,500-crore media house in a five-year period, had actually accumulated losses to the extent of Rs. 319.84 crore by March 31, 2010.

The CBI authorities recorded the statement of Sudarshan as a witness under Section 164 of the Criminal Procedure Code, in the presence of a magistrate.

According to the CBI sources, Sudarshan had admitted to over-valuation of Jagathi Publications by at least Rs. 1,000 crore, as part of an internal understanding with Vijay Sai Reddy, the No. 2 accused in Jagan’s illegal assets case. He told the CBI authorities that Deloitte had prepared the five-year business plan for Jagathi Publications in April 2008, based on the investment projections and estimated revenue inflow into the publication. The company is said to have estimated the business plan at Rs. 2,500 crore.

He reportedly said in his statement that Vijay Sai Reddy had requested him to revise the business plan by jacking up the value of Jagathi Publications to Rs. 3,500 cr. Apparently, Reddy told the Deloitte official that the revised figure was only for internal audit purpose.

He also wanted that the revised business plan should be given with a back date – November 16, 2007.

Accordingly, the Deloitte had prepared the revised business plan.

Sudarshan is said to have told the CBI authorities that the Jagathi Publications had misused the revised plan by making it public and projecting it before the prospective investors in the company.

The figure of Rs. 2,500 crore itself was exaggerated, compared to the actual worth of the company at Rs. 196 crore, as projected in the actual valuation report prepared by Jagadeesan & Company on July 12, 2007. This auditor also projected the value of Indira Television (that brings out Sakshi television channel) at Rs. 185 crore.

Sources said the CBI had questioned Sudarshan following the deposition of various high-profile investors including Matrix Prasad, Aurobindo Pharma, Hetero Drugs, Penna Cements, Jubilee Media etc., who had put in huge amounts in Jagathi Publications. All of them had told the CBI authorities that they had made investments by paying a huge premium of Rs. 350 per share only after being convinced by the business plan prepared by Deloitte.

CBN Is Most Wanted Criminal For CBI Says Laxmi Parvathi

CBN Is Most Wanted Criminal For CBI Says Laxmi Parvathi

CBN Is Most Wanted Criminal For CBI Says Laxmi Parvathi

CBN Is Most Wanted Criminal For CBI Says Laxmi Parvathi
CBN Is Most Wanted Criminal For CBI Says Laxmi Parvathi
CBN Is Most Wanted Criminal For CBI Says Laxmi Parvathi
CBN Is Most Wanted Criminal For CBI Says Laxmi Parvathi
CBN Is Most Wanted Criminal For CBI Says Laxmi Parvathi
CBN Is Most Wanted Criminal For CBI Says Laxmi Parvathi
CBN Is Most Wanted Criminal For CBI Says Laxmi Parvathi
CBN Is Most Wanted Criminal For CBI Says Laxmi Parvathi
CBN Is Most Wanted Criminal For CBI Says Laxmi Parvathi
CBN Is Most Wanted Criminal For CBI Says Laxmi Parvathi

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