A good friend of mine worked as a computer programmer for one of the big New York based banks. She has been jobless for almost a year, having lost her well-paid position after a decade of loyal service. The first lesson she learnt the hard way that there was no personal loyalty from the management. It was all about the numbers. So when it came to handing out pink slips there was little consideration of the personality and skills of the individuals themselves. Managers were simply told they had to get rid of a certain number of people. To rub salt in the wound my friend had been working alongside imported Indian workers. In a system known as “knowledge transfer” the US based staff were ordered to teach the Indians how to do their jobs – so that eventually they could return to India, and their reluctant American teachers could prepare to lose their jobs to their  Asian pupils who were being paid a fraction of their US counterparts. So what’s the outcome? The bank saves money on paper, although the “skill transfer” operation has not exactly been regarded as a huge success. There have been a number of deficiencies. The second outcome of course is the US taxpayer now has to financially support my friend until she finds a replacement job. The third outcome is that it is highly likely that it will take her years (if ever) to acquire the same decent wage and benefits. The result is that her living standard declines, and she spends less – affecting the businesses she would traditionally buy from. The fourth outcome is that she is now no longer covered by her company medical program, so if she falls ill it will be the state picking up the bill. Increasingly firms are cutting back on benefit and pension provisions, so later in life there is now also a very real expectation that the state will have to pay for her retirement care. The list goes on and on but the starting point was that a bank that was making lots of money wanted to make even more. As I studied a recent list of bank charges one stuck out – an inactivity charge. Yes the banks can even financially punish you when you don’t spend. So they’ve really got you every which way. A constant moan in my part of the world is about the credit card companies (who of course we were forced to save from financial armageddon) stiffing their customers at every opportunity. Now their outrageous interest rates are nothing new, but their deviousness and tricks know no limitations. Fiddling with the number of days in a payment cycle, altering interest rates without telling the customer, and seemingly randomly applying new reduced spending limits seems to be becoming something of the norm. I have no objection to them (finally after all these years) trying to control the amount of money they lend, it’s more about the way that they apply their new systems. The words “manners” and customer courtesy” are apparently less important these days. The collapse of large financial institutions has of course had many in the financial world rubbing their hands with glee. There have been some stunning profits as there are now less players in the game. It seems like a cartel where you simply can’t lose. And there almost seems like a desperate rush to max out every last dodge and trick before some new regulation is introduced to try and control and protect the ordinary man in the street from the chaos created by the relatively greedy few. At a time of mass unemployment does it make sense to allow companies to continue exporting thousands of jobs abroad? At the very least I believe they should have to pay a tax levy on every job lost this way, which would take into account the potential costs now awaiting the US taxpayer in supporting the pink-slipped worker. I do though have some hope that people power will have an impact. As I stated in a previous article you can exploit people and get away with it for so long, but eventually it will catch up with you and there will be a hefty price to be paid. By way of illustration most people I know now have a very different outlook on money than they did a couple of years ago. Now there is a real desire to clear the credit card debt once and for all. I believe millions are trying to do just that across America and elsewhere in the world, with a determination that we’ve not seen before. The lesson has been learnt that these companies are not really there to help you – they are there to help themselves. Michael Moore may be a controversial film maker, but the message of his new epic concerning capitalism and how it is failing people is irrefutable. How can the USA, the leader of the free world, allow millions of its citizens to have no medical coverage, to disallow people with medical conditions from taking out health insurance, and end up in the bizarre situation that where the banks are handed impossibly large sums of money that we all have to pay for – and receive nothing back for it. Sure the Government might eventually make some money, but the citizens will never see a penny of it. Instead our taxes will increase to pay for the bail out, and more jobs and homes will be lost as the knock-on effects of the banking scam continue. Hardly anyone faced any form of punishment for what happened. Most regulators who sat and did nothing continue to sit and talk about doing things, although I suspect that when the big financial lobbies have done their work any change will be watered down, allowing a near return to “normal” business of exploitation, greed, and massive financial inducement to generate ever more cash at whatever cost. It can’t go on. Look at what happened with oil. The cartels bumped the cost of a barrel up 100 per cent in just a year. The world allowed it to happen but the price was unsustainable. The most immediate impact was that people stopped driving for leisure. Car sales slumped, people refused to fly because it was now too expensive, businesses cut back on their electricity. The politicians allowed it to happen, and as of right now it could happen again tomorrow. Speculators continue to try and manipulate the price with impunity. This is the short term thinking at his craziest. Look what happened to Russia. It’s economy driven by oil and gas went from profit to loss nearly overnight. In the UK the British National Party has been on the rise. As an organization it has been heavily criticized for it’s white supremacist overtones. But that’s not why people have been electing their representatives as members of parliament or to the European parliament. No the real reason they have been gaining power is because they have said they they are prepared to take radical and effective steps to bring about change. They have been talking about taboo subjects such as protecting the rights of the indiginous  population – i.e. those who have lived in the UK all their life. They don’t think it’s right that someone newly arrived from another country gets more support from the state, and is allowed to jump waiting lists because they are from an ethnic minority. Yes they need help and support – but it should be on an equal basis. The BNP also don’t think that allowing completely unrestricted immigration into the UK has proved a resounding success as certain communities have found themselves swamped by new arrivals. I’ve touched on British politics purely as another example of how eventually the power of the people can force politicians to at least rethink their policies. Change is needed. Is there anybody in a position of power listening? I hope so.

“Corporate Greed” Written and performed by: Eric Koeppel

Copyright (c) 2010 Scott F ParadisWe are experiencing nothing less than an economic train wreck. The financial express has reached the end of the line – the real economy, the freight cars, are cabled to the sleek engine impaling itself on its fated destination. We have nothing to do but hunker down, hold on tight, and dodge the debris.We have made a gargantuan bet. We have placed all our chips in and have pulled the entire world into our game. We have made a grave error. This error has far reaching consequences for ourselves, our nation, and our world. The most powerful nation on the earth has wagered its future and squandered its inheritance on the illusion of finance as the basis for an economy.We can blame the unscrupulous financial titans and captains of industry, we can blame an inept government, but in the final analysis – the buck stops (pun intended) here. We are to blame for participating in, fueling, leading and in short order allowing the nation to jump on the consumption bandwagon. We have been so giddy pursuing wealth or frittering it away we have disregarded the storied wisdom of thrift, industry, and innovation. Now that the train is wrecking – the engine is a molten mass of metal, the lead cars aflame, the tracks shattered – the rest of the economy is fast approaching the point of reckoning to obliterate itself where unbridled excess comes home to roost.The fool’s errand of betting future prosperity on the engine of finance is twofold. First, money is not real. Money is a medium of exchange, a unit of account and a store of value. Money has become our means, our measure, our standard and yes – our obsession. Betting the health and vitality of an economy on the manipulation, control and transfer of an intangible, is folly. Second, by unleashing every means to fuel the flames of finance’ meteoric rise to dominance we unwittingly unchained the greed and corruption of human nature. We have determined, “money is power” and there is no more tempting an elixir than power. Every ounce of leverage the financiers and government officials have managed to employ over the last forty years is now working against us.Though founded on the principles of liberty and justice for all, the United States has gone astray. We have succumbed to the fallacious notion that markets ought to be free even unconstrained by conscience. This lie proliferates with the tacit dismissal of the other key component of freedom – responsibility. Responsibility and freedom are two sides of the same coin. In polite society one cannot exist without the other. We dismiss responsibility at our own peril. Unrestrained freedom is a sure road to ruin. By wagering on and then building systems to ensure finance became the dominant force in the American, and global, economy we committed ourselves to experience the wreck now unfolding.As with every crisis this financial train wreck has within it the seeds of opportunity. This opportunity goes far beyond our financial wellbeing. The opportunity lies in reassessing our purpose for being, redefining our quality of life. This train wreck offers us another lease on life. We can change direction, chart a new course, seize a new opportunity, usher in a new birth of freedom.We have lost the American ideal and shattered the American dream – yet the true strength of this nation is the resiliency of its population. America was built by people who assumed responsibility for their actions, took risks, and ingeniously applied their energy and effort to the hope of securing a good life for themselves and their posterity. It has taken us some forty plus years to accelerate to this point on the tracks, but all is never lost. To resolve this mess we must act and act wisely.This is clearly a situation of our making, requiring a solution we must engineer. We can choose a path of self-righteous indignation. We can condemn Wall Street greed and incompetent government oversight and placate ourselves by placing blame clearly in others’ hands. Choosing to assign blame however, relegates us to the role of powerless victims in a painful, all consuming drama. We will cry for help and sit with arms outstretched, waiting for the benevolent charity of people with power, those charged with managing our pathetic lives – the wealthy elite and government officials who cannot even identify the problem. Or we can choose to accept responsibility for the mess we have created – the financial train wreck – and begin to right a wrong. Only in this way can we redeem ourselves. Choose!

Walked into the middle of this one, lucked into an exellent play. Good example of the main strategy you go for in a map like this.

Obesity is a national crisis. Our seniors are Fat, our middle aged are Fat, our teenagers are Fat and so are our children AND they are getting Fatter!
You have heard the statistics.
Thankfully Michelle Obama, Pepsi, Kraft foods and others are taking the leadership in reducing the sugar, Fat and salt in their products.
The old corporate, unspoken and un-admitted motto for many in the fast food industry was a silent war of them and us and them.
Supply “It” and they will eat “It” and drink “It”! So what if they will get Fatter and more unhealthy and even die from preventable lifestyle induced diseases that are in our power to stop. That is neither our responsibility nor our problem. They don’t care about their health; our shareholders care about our investments. So let our profits soar. We’ll even supersize it and thereby profit some more!
For years, there were the cola wars and the burger wars. There was more sugar for the younger Pepsi Generation. Get them when they are young. We’ll give them toys, collector items for their parent and playgrounds. For their value conscious parents, we’ll make it larger: extra size, extra Fat, salt and sugar.
Serve “It” and they will buy “It” and we will have customers for life. They will bring their kids and grandchildren too. Corporate was right: They did and they got Fat and Fatter, as butts and profits soared.
We have ignored corporate greed and the public’s gluttony long enough. Excess is killing our people and bankrupting our society. It is time for change and time for our governmental and corporate leaders to help us,  the common flock, DO something positive and permanent about what we eat and drink.
Pepsi is courageously facing the truth of errors past and willing to take the lead for a New Pepsi Generation. Bravo! So is Kraft. So is Michelle Obama.
Bravo to you and to those others who will follow suit, to those others who will change what we produce and what we sell to ourselves and to future consumers.
It has taken almost 50 years since Bob sang: “The times they are a changin!” Bob Dylan
Finally there is a movement. There is New Leadership, New Rules, New Opportunities to address Wellness instead of creating and supporting illness for profit!
Our leaders can only lead those who are willing to follow. This is no longer about power, profit and control. This is about our wellness, our lives, our children’s and the lives of generations to follow.
Fat is Fat! Fat is also a metaphor for uncontrolled excess. We are bursting at our seams and it finally seems time to address wellness.  We can’t afford to live this way any longer.

High-performance protection at the network edge—what, why and how With more demands being put on lightweight network-edge hardware to provide security as well as connectivity, a new hybrid approach combining simplified malware detection with URI filtering can offer excellent proactive protection without overburdening the hardware or the administrator.

Summary With more demands being put on lightweight network-edge hardware to provide security as well as connectivity, a new hybrid approach combining simplified malware detection with URI filtering can offer excellent proactive protection without overburdening the hardware or the administrator. Combining solidity and efficiency—the protection conundrum The malware epidemic continues to flourish around the world, with every step forward in technology and connectivity polluted and abused as soon as it becomes popular. As networks and working practices evolve to take advantage of the latest technologies, new protective strategies must evolve to provide the best possible level of security. Monitoring network gateways and links for malicious traffic has been a standard practice for some time. But as traffic demands and network complexity increase, simply proxying traffic through traditional security filters running on traditional processing hardware is becoming an ever more expensive option, less than ideal in many environments. The ideal point to detect and remove threats is at the edge of the network itself, but the devices sitting there often have limited resources and are not ideally suited to conventional scanning techniques, based on local databases of specific and generic detection signatures. In modern multi-site businesses, branches are often connected via lightweight routers or UTMs with limited resources. Even in major sites deploying full-scale appliances performance is under pressure from increasing demands. A new approach is required to provide fast, accurate threat blocking that will be effective on hardware with limited memory and processing power, and with little opportunity for local updating. A lightweight, flexible but still powerful approach, combining high levels of protection with minimal resource usage, is the only viable solution to the problem of efficient, effective threat defense in an environment where resources are at a premium and throughput latency carries a heavy cost. A web full of threats—the modern malware attack vector In the early days of malware, the primary infection vector was the floppy disk; this was how data was transferred from one machine to another, and so malware followed the same route to find new victims. As email became ubiquitous and we began exchanging files as attachments rather than writing them to solid media, malware joined in and infected attachments became the transmission method of choice, with worms incorporating their own SMTP engines, developing social engineering techniques and spreading wildly. For some time now this vector has been in decline; although it continues to represent a threat, it is mainly limited to exploiting document formats, as savvy administrators have long since learned to simply block all executable attachments automatically. The main danger of email these days is in the links it may carry to malicious content, hosted out on the internet. These days everything is on the internet. We not only store our own data online and exchange information with colleagues and clients over the web, we also require access to the mass of collective information posted online by others. Restricted web browsing is no longer an option in most businesses, as any user in any way hampered in accessing the information required to get his or her job done is an employee not working to maximum efficiency. It’s no longer simply a question of monitoring the gateways at the edges of corporate networks either, as multi- site businesses become the norm, and remote and travelling workers require equal access to both internal company networks and the web at large. The network boundary has become a porous, vaporous idea rather than a tangible line in the sand. Malware has of course followed this trend, and the internet is steadily drowning in dangerous content. The proportion of infected sites, whether malicious by design or legitimate sites compromised to host threats, grows exponentially. Social engineering used to lure us to these attack points grows ever more sophisticated, taking advantage of every emerging trend in communication, from email to the deluge of social networking systems, each of which seems doomed to become swamped in spam links to risky sites from the moment its first early adopters begin to sing its praises. As malware itself is ever more cunningly crafted to elude detection and sneak precious data from infected systems, so the lures and tricks used to bypass our human defenses grow more devious day by day. Every possible weakness of the human mind, from greed to fear to simple curiosity, has been targeted as a way of persuading us to follow a link, allow a script to run, enter a password and throw ourselves and our machines open to whatever the malware creators have in mind. Most worryingly for businesses, malware and the associated infection techniques have become increasingly targeted to penetrate specific companies, trick specific users and steal specific, often highly valuable corporate data. While endpoint-level protection on the desktop provides a strong defense, most businesses will want to provide maximum security, with minimal impact on worker productivity, by filtering the bulk of threats at their network boundaries and at strategic points between network nodes. A wall full of gaps—the modern business network edge In the early days of business networks, the corporate LAN was like a castle, sealed off securely from the outside world with a single way in or out, which could be heavily protected and monitored. These days such an approach is impossible, with users needing to connect in and out of the network, and with each other inside it, in a vast number of ways. Internal mail systems and data storage must be accessible externally for home workers or those on the road, not just from traditional computers but from smart-phones, PDAs and an ever growing range of devices. Clients and partners need to access online resources not just to read pages of text, but to interactively, post data and content and pass all kinds of traffic on and off web-facing servers. Even within the corporate network, different nodes and sites must be interconnected smoothly and transparently, but still need to be protected from the outside and each other. In many situations, monolithic, expensive appliance-based solutions can no longer provide the required protection without seriously impeding the flexibility of the business. In such situations, the deployment of multiple, inexpensive lightweight devices at network boundaries and between nodes seems the ideal solution. With built-in firewalling on routers commonplace and lightweight UTM devices becoming ever more complete packages, the inclusion of malware detection is an obvious and logical step up. These devices represent an ideal bottleneck at which threats can be filtered out of the traffic flow, but by design are unsuited to the traditional threat detection model. Standard malware detection techniques require ample processing power and memory space, and also need regular updating to maintain complete efficacy against the latest emergent threats. Desktop-level protection provides a solid last line of defense, with minimal impact on users thanks to the combination of modern, efficient scanning and high-powered hardware. But this last line should be shielded by additional layers

of protection, to keep users from the impact of malware attacks and the intrusion of detection alerts, keeping their systems and their working time efficient and profitable as well as safe. Many other modern devices also function as full-spectrum computers with far fewer resources, notably mobile devices, and these too require protection that does not overburden their limited memory, storage and processing power, adding another layer of complexity to the design of full-canopy protection, and these devices would also benefit from a different approach to security. Combining full-strength endpoint protection with additional layers that complement each other, covering the gaps in the armor, can provide a solid barrier against attack. but achieving the right level of overlap shifts much of the filtering burden to devices at the network boundaries. In most lightweight network devices, the kind of resources required are simply not available, and updates represent an even bigger hurdle. Updating firmware on a UTM or router is a labor-intensive, generally manual task with an element of associated risk; any such update can lead to problems and loss of precious connectivity. Such a task needs to be performed as seldom as possible, while conventional anti-malware technology requires updates ever more frequently. Although core engine improvements may not need to be applied as often as detection updates, which in many cases appear hourly or even more often, engines still need updating once a month or so to add new functionality and enable proper detection of the latest generations of threats. This sort of schedule is well outside the acceptable boundaries for updating firmware-based devices. At first glance, combining the requirements of these devices—the need for rapid throughput of high levels of data on low-powered, seldom-updated hardware—with the needs and powers of conventional anti-malware solutions seems an impossible task. Compromise and avoidance—how the UTM problem has been approached A number of solutions have been proposed and implemented to provide anti-malware protection in lightweight network-edge devices, with varying degrees of success. The simplest and most obvious have also suffered the most predictable shortcomings. The initial response to the requirement for network edge scanning was to skirt the issue entirely by imposing a proxy, rerouting traffic off the lightweight device and through a conventional scanner system running on a full-powered secondary machine. This allows for the most comprehensive detection the provider of the detection technology can produce, with full access to the required resources including frequent updates, but imposes a heavy burden of cost and equipment as well as less than optimal latency compared to the throughput capabilities of the lightweight device. Other implementations have provided a standard file scanning engine with a pared-down, “core” set of detection definitions, speeding up throughput to an acceptable level and minimizing the updating requirements. This provides a basic level of protection against the most common threats, but has some fairly obvious negative implications for completeness of detection. A slightly more successful alternative has been to develop a simplified engine capable of processing the data streams passing through lightweight devices at reasonable speeds with regular-expression-based detection methods targeting known threat types. Some variants of this approach have even been able to introduce limited updating onto the device. Even the most sophisticated systems using such techniques offer no more than a cut-down version of the protection of a full traditional signature scanner, with incomplete proactive protection against new-emerging threats, and still impose a burden on resources and require physical access for regular updates. Another option is the use of online resources, with the scanning system referring to detection and threat data stored “in the cloud”. With some cloud-based systems requiring considerable amounts of traffic to transfer detailed file characteristics and detection information back and forth, latency can become a serious problem, especially with large numbers of files passing through a device and requiring off-system lookups. A per-file lookup approach, which imposes heavy increases in traffic volume and slows the device throughput as well as potentially compromising the privacy of sensitive data, is no silver bullet. The complete solution—a hybrid approach Taking all these conflicting requirements and capabilities into account, a set of rules for the ideal approach begins to emerge: »»For maximum economy and efficiency, malware filtering needs to take place on the lightweight device, ruling out the proxying method. »»To maintain the required throughput level, the scanning engine must be lightweight and capable of processing large amounts of data with limited resources of memory or CPU. »»To keep the memory footprint down, large amounts of detection data should not be stored on the device; while to avoid firmware updating requirements, improvements to the engine logic must be applied live and remotely, leaving the hard-coded components integrated into the device firmware untouched. »»Finally, complex remote lookups of each and every file need to be avoided to minimize latency and added traffic, so a second form of threat detection is required—filtering not by file, but by URI. With a large and sophisticated web monitoring system identifying and cataloging infected sites, a quality threat lab can build a comprehensive database of known bad URIs, rapidly spotting and responding to new outbreaks. This database can be checked at high speed from the detection system of a lightweight device as it processes the HTTP data passing through it, and malicious sites can be blocked in real time. Filtering the source of malware rather than filtering by file recognition saves both time and effort; the complex obfuscation techniques employed by some malware seeders—such as server-side polymorphism, where files are tweaked and repacked frequently to minimize scanner detections—are completely bypassed. As the web is increasingly the vector of choice for malicious code penetration, with code and scripts entering networks from infected or compromised web pages, HTTP represents the bulk of traffic passing through these gateway devices. This. approach thus covers all but a tiny fraction of transferred data, as shown by its performance in full-scale appliances, drastically cutting the load on the other protective technologies included in such equipment. Operating alongside this system, a cloud-based file lookup is also used for files from unclassified sites and for protocols not providing URI information, with much lower demands thanks to the initial URI filtering. As the vast majority of malware carried via non-HTTP protocols consists of simple, static files, these samples can be identified by simple checksums, removing the requirement for complex file data to be gathered, sent to the cloud and checked. These two overlapping layers of protection can operate via existing universal technology—the DNS lookup system used across the internet—to deliver high-speed responses to cloud lookups. The back-end databases can also monitor lookups coming in, watching for trends and patterns and using the telemetry information gathered to provide additional real-time reactivity to new outbreaks. The style of protection provided perfectly complements the more file-based approach of the full-powered desktop solutions it backs up, and is extendable to a wide range of similarly low-resource, high-throughput devices—even to mobile devices like smart-phones given the plummeting costs of connectivity. Together, the two layers provide a level of protection at least 95% as accurate as in-depth, resource-hungry per-file inspection, and in many cases improving on detection rates of file-scanning techniques thanks to skirting the problem of server-side polymorphism. Reaction times for new attacks are extremely fast, resource consumption is minimal and physical updating of firmware is drastically reduced. All in all, this hybrid approach ticks all the boxes, fitting the constraints of lightweight environments without compromising on protection.

                        Satyam: All is well that ends well   In Q2, our revenue grew… on the back of a 4-per cent volume growth and rupee depreciation against the US dollar… We believe these factors will also enhance annual margin performance… I would like to emphasise that Satyam is leaving no stone unturned in our efforts to create a sound foundation for our future. Note to investors from B. Ramalinga Raju, Founder & Chairman, Satyam Computer Services, when declaring the company’s results for the quarter ended September 2008   The balance sheet carries as of September 30, 2008 inflated (non-existent) cash and bank balances… The gap in the balance sheet has arisen purely on account of inflated profits over a period of last several years (limited only to Satyam stand-alone…) Note from B. Ramalinga Raju to the Board of Directors of Satyam dated January 7, 2009   About Ramalinga B Raju   Byrraju Ramalinga Raju (born September 16, 1954) is the founder of  Satyam Computers and was its Chairman until January 7, 2009 when he resigned from the Satyam board after admitting to corporate fraud. For a man who ran India’s fourth biggest software exporter, Mr Ramalinga Raju was not a showy person.His bungalow in Hyderabad city’s upscale Banjara Hills is an understated two-storey structure, with parking for no more than three or four cars. Friends who have dealt with the 54-year-old chairman of Satyam Computer Services, say it is difficult to know what he is thinking behind a calm exterior. He goes for morning walks, but seldom appears at the swinging parties of Hyderabad’s elite.Behind his back, they sometimes refer to him as ‘the man with the Mona Lisa smile’. Mr Raju, a native of Andhra Pradesh state in southern India, had a comfortable head start: He studied abroad, obtaining a business management degree from Ohio State University. On his return, he began his career with forays into construction. Satyam, , was set up in 1987 with 20 employees as Raju spotted the opportunity in outsourced code-writing. He was on the board of Naandi, a non-governmental organisation based in Hyderabad which does stellar work in providing clean drinking water in rural areas and supplying mid-day meals to more than a million schoolchildren across India. He also runs the Byrraju Foundation, named after his father, and an emergency ambulance service that has won global acclaim.       About Satyam Cmputer Services Ltd “The truth is as old as the hills” opined Mahatma Gandhi, So a company named “Satyam” (Truth, in Sanskrit) inspired trust, Satyam Computer Services Ltd was founded in 1987 by B Ramalinga Raju. The company offers Information Technology (IT) services spanning various sectors, and is listed on the New York Stock Exhcnage and Euronext. Satyam’s network covers 67 countries across six continents. The company employs 40000 IT professionals across development centers in India,  the United States, the United Kingdom, the United Arab Emirates, Canada, Hungary, Singapore, Malaysia, China, Japan, Egypt and Australia It serves over 654 global companies, 185 of which are Fortune 500 corporations. Satyam has strategic technology and marketing alliances with over 50 companies. Apart from Hyderabad,  it has development centers in India at Bangalore, Chennai, Pune, Mumbai, Nagpur, Delhi, Kolkatta, Bhubneshwar, and Vishakhapatnam Chronology of Satyam   Sr.No. Year Event 1 1987 Ramalinga Raju establishes Satyam Computer Services Ltd. 2 1991 Satyam gets listed on the Bombay Stock Exchange, IPO oversubscribed 17 times. 3 2006 Revenues cross ‘$1 billion.’ Raju becomes Nasscom Chairman. 4 2007 Raju named Ernst & Young Entrepreneur of the Year. 5 2008     September 23 Satyam awarded with Golden Peacock Award for Corporate Governance and Compliance.     December 16 Satyam Chairman Ramalinga Raju announces plan to buy Maytas Infra and Maytas Properties owned by his sons for $1.6 billion.   December 17 Raju does a U-turn because of negative investor reaction   December 23 Satyam barred from business with the World Bank for 8 years for alleged malpractices in securing contracts. Shares fall to lowest in 4 years.   December 25 Satyam asks World Bank to apologize   December 26 Board member Mangalam Srinivasan resigns followed by exits of members Vinod Dham, Krishna Palepu..     December 30 One of Satyam’s largest investors says it could sell its stake.More suitors join in the fray to acquire Satyam. 6 2009     January 2 Satyam says its founder’s stake fell by a third to 5.13%.   January 6 Satyam’s i-bank DSPML meets Sebi, informs about accounting irregularitites   January 7 Ramalinga Raju resigns, discloses a Rs 7000-crore accounting fraud in balance sheets about cash which never existed in the company.   January 8 Satyam’s bank Citibank freezes its 30 accounts. Interim CEO Ram Mynampati says company in severe cash crunch and may not be able to pay salaries. Satyam’s auditor PwC faces ire.     January 9 Ramalinga Raju and his younger brother B Rama Raju arrested by Police. Central Govt disbands Satyam board, to appoint its own 10 directors.   January 10 Satyam’s largest investor Lazard seeks a nomination board. SEBI grills Raju.     January 11 New Satyam Board announced, Mr. Deepak Parekh, Kiran Karnik and C Achuthan appointed as board members   Feburary 5 A S Murthy appointed as new CEO   April 16 Company Law Board approved stake sale to Tech Mahindra     The Satyam Scandal – Explained   Satyam, which ironically means ‘truth’ in Sanskrit, was set up in 1987 with 20 employees as Raju spotted the opportunity in outsourced code-writing. Within no time, business was booming. Andhra Pradesh, of which Hyderabad is the capital, has one of the largest pools of skilled manpower in India. Satyam would prove a doughty competitor to its rivals, pricing its services so aggressively that some thought it was prepared to go with minimum profits in order to gain customers. And it expanded aggressively overseas. When he opened his Sydney office a few years ago, he occupied premises vacated by a top global IT firm. In China, provincial leaders vied to invite Satyam to set up operations in their areas. But once Mr Raju sold shares to the Indian public in 1992 and later, went for a New York listing in 2001, pressure grew on him to improve the company’s performance. Ever competitive, he was also in a rush to catch the market leaders, Tata Consultancy Services, Infosys Technologies and Wipro. Raju was obsessed with getting past the billion-dollar sales mark. When he got there, he wanted to post US$2 billion. Satyam posted US$2.1 billion (S$3.1 billion) sales in the year to March 31, 2008.With the ever-rising pressure to perform, Satyam began doctoring the books to show bigger profits, a process that began several years back.     For Satyam, the recent developments are a direct leftover of the past. In fact, the story is about a decade old. In late 1999, IndiaWorld — a largely unknown internet firm — was acquired by Satyam group company, Satyam Infoway, for an eye-popping Rs 500 crore. The consternation that accompanied this deal was not hard to comprehend. IndiaWorld had a topline of just Rs 1 crore and a net profit of an insignificant Rs 25 lakh. At Rs 500 crore, Satyam Infoway, later renamed Sify, was paying this astronomical sum not just for IndiaWorld but for a number of sites that came with it — among them were samachar.com, khel.com and khoj.com. The argument dished out was based on the potential of the internet business and the logic of eyeballs was driving this valuation story. One was not sure about the source of funds and how much money went back to Ramalinga Raju.  A few months later in 2000, shareholders of Satyam were an irate lot. At the annual general meeting (AGM) of the company in Hyderabad in May 2000, shareholders accused Satyam of withholding facts and claimed they were defrauded. This was after the merger of three subsidiaries — Satyam Enterprise Solutions (SESL), Satyam Renaissance Consulting and Satyam Spark Solutions — with Satyam Computer Services. Post merger, 8 lakh shares of Satyam Computers were allotted to C Srinivasa Raju, who was then Satyam Computers’ executive director.  Shareholders contended that SESL had made a rights issue of 12 lakh shares at par just before this merger. A third of this was bought by Satyam Computer while the remaining 8 lakh shares went Srinivasa Raju’s way after they were renounced. Once shareholders of SESL were given shares in Satyam Computers in a 1:1 proportion, Mr Raju got 8 lakh shares at just Rs 10 each, when the shares were trading at a whopping Rs 1,600. The management of Satyam Computers, however, maintained that things were above board, though shareholders thought otherwise. The seeds of accounting manipulation in Satyam were sown several quarters before Ramalinga Raju’s communiqué to the board on Wednesday, 7th Jan-09. In 2002, the department of company affairs (DCA) was in receipt of a slew of complaints from Satyam’s shareholders that there were accounting irregularities in the company. Here, it was stated that Satyam’s directors invested unwisely in subsidiaries that were underperformers. This merely facilitated the process of tax evasion and employing methods such as writing off large amounts on depreciation.  At first blush, Raju’s statement to the board in which he confesses to inflating profits appears a act of contrition by a man who was willing to stand up and face the music for his transgressions. If Raju was dressing up the bottom line, it was only to boost the company’s valuation and ensure that it stayed in the big league of IT services. A higher valuation also enabled Raju to borrow more money against his shareholding.       But Where did the money go?   Raju claims that Satyam inflated profits for many years… By inflating cash and bank balances of Rs 5,040 crore (as against Rs 5,361 crore reflected in the books) Accrued interest of Rs 376 crore is non-existent Liability of Rs 1,230 crore is understated on account of funds arranged by “me” Debtors position of Rs 490 crore is overstated (as against Rs 2,651 reflected in the books)   but if this Rs 7,000-odd crore did not exist… How were the salaries of 53,000 employees being paid with a business that ostensibly survived on just a 3 per cent operating margin? Were there more employees on the bench (than revealed)? Was Raju inflating profits to boost Satyam’s valuation, and borrowing money by pledging its shares? …but if the money did exist… Did the Rajus use Satyam funds to build a land bank of over 6,000 acres via a web of unlisted companies?   What happened to the funds raised? There was an ADR issue in 2001, via which Satyam raised Rs 753 crore and on March 31, 2002, Satyam became an almost zero-debt company with Rs 431 crore unutilised amount of ADR proceeds                         The cash was king for Satyam   If Satyam was fudging profits, where were the funds for all-cash acquisitions coming from?   Sr.No Year Acquired Firm Profession Funding (Amount in $) 1 Apr-05 UK based Citisoft PLC Business Consulting Firm 38Mn (Paid in tranches) 2 July-05 Singapore based Knowledge Dynamcis Consulting Solution Provider 3.3 Mn (All cash deal) 3 Oct-07 UK based Nikor Global Solutions Infrastructure based management services and consultancy group 5.5 Mn (All cash deal) 4 Jan-08 Chicago based Bridge Stratergy Group Management consulting firm 35.00 Mn (All cash deal) 5 Apr-08 Caterpiller Inc Market research and customer analytics operations 95.5 Mn for both deals (all cash purchase)     S& V Management Consultants Supply chain management frim       The Downfall of Raju   The downfall of Raju, began in Dec 08 when Satyam attempted to acquire two companies controlled by his sons – Maytas (Satyam spelled backwards) Properties and Maytas Infra – for 1.6 billion dollars in order to compensate for the holes in his books of account. The deal was abandoned 12 hours after it was announced when investors objected, claiming it was an irresponsible misuse of funds and an instance of nepotism. The Maytas deals acted as a red flag for international investors, with a host of companies like Unpaid Systems of Britain accusing Satyam of fraud, forgery and breach of contract. Shortly thereafter, on Dec. 23, the World Bank barred Satyam from offering its computer services for eight years citing a potential trail of corruption – data theft and bribery – that led to Raju. The last straw perhaps came on Jan 09 when an Indian associate of Merrill Lynch terminated an agreement on grounds of “material accounting irregularities”.  The Role of Auditors   There is intense debate about the role of PricewaterhouseCoopers, the external auditors of the company in clearing the accounts of Satyam. Auditors are supposed to have checked, verified cash balances, bank statements, assets with relevant confirmations. Satyam was a large company, not a street store; PricewaterhouseCoopers is a globally reputed firm. The auditors cannot hide under the standard clause ‘auditors can be watchdogs and not blood-hounds’ especially when cash and bank balances have been overstated.   Role of Directors The Companies Act in India has stringent corporate governance requirements of board members. Yet Raju was able to steer the fabricated accounts through his board members for 6-years! This has bewildered the corporate sector and regulators. At times, the company was holding excessive cash, as per the books. This should have invited questions by board members.In particular, Independent Directors, who are appointed by shareholders at the behest of the board, are selected on the basis of their reputation, knowledge, and wisdom. They are the first defense of minority shareholders. Generally they bring specialized expertise. Independent directors have to meet standards set by stock exchanges too. The Indian Government specifically delineates the role of independent directors in safeguarding the interests of the organization and the shareholders. An independent director would normally assume that audited accounts have been rigorously examined. This is more so when an internationally credible firm- like Pricewaterhouse Coopers- has audited the numbers. But, they need to still ask the right questions and probe. Sitting on numerous boards compresses the time an independent director has to reflect on what is happening inside the belly of a company.     The Facts about  Insider Trading   Raju has claimed that no one else in the company was privy to the fudging of accounts. But the facts speak something else. BSE figures show a number of senior people in the company, including Raju and CFO Vadlamani were reportedly selling Satyam’s shares over the last 22 quarters.     Sr.No. Name of the Officail Year Stake in the Satyam/ No. of shares sold 1 Ramanlinga Raju June-2001 23.0%     Dec-2001 22.4%     Sep-2002 21.6%     2003 19.0%     2004 16.0%     2005 14.0%     2006 11.0%     2008 8.27% 2 Vadlamani (Then CFO)   92538 shares 3 Ram Mayanpari  (Then CEO)   7,00,000 shares and 2,50,000 ADR’s 4 Kiran Cavale   4,00,000 shares and 10, 000 ADR’s 5 Rajan Nagarajan   4,30,000 shares and 70,000 ADR’s       Satyam Fraud Investgated   As soon as Ramalinga Raju confessed about the fraud, all the government deparments started investigating about the fraud. The deparments include CBI, SFIO, SEBI, ICAI and RBI.     CBI reveals modus operandi of Satyam fraud   Using cyber forensic techniques, the CBI has deciphered the modus operandi of the Satyam fraud. Following are the findings of CBI for some areas:   Sr. No. Area Remarks 1 Sales Data IT company generated false invoices to show inflated sales. 7561 invoices were found to be hidden in the Invoice Management System. These invoices were worth Rs.5,117 crore. The accused already entered 6,603 of these, amounting to Rs. 4,746 crore.   2 Receivables The fraud invoices resulted in creation of inflated receivables 3 Fixed Deposits Investments shown as fixed deposit receipts (FDRs) worth crores of rupees were fake and printed from his personal device. The fake FDRs showed huge amounts, as the interest on these deposits was projected to be over Rs 375 crore, as against the actual interest income of Rs 7.42 lakh only. 4 Bank Guarantee Manipulated the Bank Guarantees to show balance in bank accouts as Rs. 1800 crore 5 Balance in bank accounts Forged the  bank documents showing the existence of the cash balance in five banks including ICICI Bank, HSBC, Citibank and BNP Paribas but the banks clarified that they do not have any cash balance in the name of the firm. 6 Who all were involved CBI Chargesheet names Ramalinga Raju, Rama Raju, Suryanarayana Raju, V. Srinivas, S. Gopalakrishnan, T. Srinivas, G. Ramakrishna, D. Venkatapathi Raju, and C. Srisailam.       The revelations by Serious Fraud Investigation Office (SFIO)   The government, on January 13, had initiated an SFIO probe into various corporate aspects of the fraud under Section 235 of the Companies Act. The SFIO is a multi-disciplinary body set up in 2003 to investigate serious financial frauds. It consists of tax professionals, auditors, fraud examiners, capital market experts and banking professionals. Following are the revelations of the SFIO Commitee   Sr. No. Area Remarks 1 Main areas of inflation inflation has happened mainly on six accounts, One is by falsifying cash and bank balances, by showing fictitious FDs, by showing fictitious interest being accrued on those FDs, by showing understated liabilities and also by showing overstating debtors.   2 Exports Inflated to the tune of over Rs. 4500 crores over the last 7 years 3 Currency Remittance Amount of Rs. 1940 crore is still unremitted 4 Books Books inflated to the tune of Rs. 27167 crore 5 How long has thisbeen going on Fy 01 to Sep 08 6 Reason for fraud Very weak invoice management system and weak accounting practices 7 Accounting Sofware Loopholes in accounting software and left passwords unsecured to facilitate fraud. software system for managing company’s financial accounting functions was deliberately made very complex for inflating profits 8 Invoice Management System Weak password protection making the system vulnerable to misuse. Therefore, fake invoices could be created by unauthorised users. In order to Balance the collections against these fictitious invoices, they were first shown as receipts in the current account maintained with the Bank of Baroda, New York Branch and subsequently they were shown to be transferred to other bank accounts as fixed deposits. There were no validation checks for a number of invoices. The SFIO report points towards a serious control deficiency in the system that facilitated entering of unauthorised transactions, making unauthorised payments and non-detection of unauthorised activities.   9 Fixed deposits The promoters were regularly generating fake quarterly balance confirmation letters showing the amounts of fixed deposits and the interest accrued on them. These forged current account balance statements and confirmation letters were fed into Satyam’s accounting software Oracle Financials for the quarterly audits of the company.   10 Current Accounts three other bank accounts in India, Citi Bank, HDFC Bank and HSBC were also used for this purpose of falsification of current account balances.     SFIO in its report on the Satyam fraud case said that the IT company’s claims of depositing funds raised through American Depository Shares in 2001 in banks could not be verified. Satyam in 2001 through a public issue in the US raised Rs 760 crore and claimed it deposited the amount in Citibank, New York. Though the company claimed that it transferred Rs 397 crore to India, the SFIO report said, it was wrongly mentioned to have been transferred to India and the actual utilisation of this amount could not be traced as all the amounts were transferred from this account to some unknown accounts through Citibank, Bahrain.       Satyam- Now Tech Mahindra   Tech Mahindra pipped Larsen & Toubro and the Wilbur Ross group to claim the fraud-hit Satyam Computer. According to early reports on Monday, Tech Mahindra is paying Rs 1757 crore for a 31% stake in the company, or Rs 58 per share. Satyam Computer Services has now zoomed 15% to Rs 54.20 ahead of the announcement of the highest bidder for the company on April 13, 2009.     Conclusion   The Satyam Saga cannot be concluded in just few pages. The truth is still to be revealed. The only truth which we know now is  that  nearly $2 billion of wealth that belonged to 3 lakh shareholders  eroded in a week; the jobs of 53,000 were on the line; the shareholders’ net worth drops from a positive Rs 8,529 crore to a negative Rs 278 crore only because of greed of few people.   But one thing is very true had it not been for a fraud, the way things were manipulated for over seven years in IT major Satyam Computers could be a “work of art”, If it were not for a dishonest purpose, the planning and execution to the minutest detail is truly admirable.   But we still wonder What was Raju thinking; since when—and why—was he thinking this way; and how did he do it?                                                                                     

Hiring the right people for the job is an essential part of the success of your business. Identifying a suitable candidate is just the beginning of the process. Before you offer the job, it is important to conduct a thorough background check on the person you are hiring.

Paul Fazio, Director of Corporate Accounting at Dr Pepper Snapple Group, Inc., rocking out at this year’s Holiday Party.

We know from having heard numerous stories reported again and again on TV and in newspapers over the years about “pork barrel” spending, that our government is not necessarily judicious in watching the purse strings (to say the least). However, I heard an expose reported by ABC news in Phoenix earlier this week that made my blood pressure rise.The headline: “Social Security spends $700,000 on Phoenix conference.”This investigative report was broken by Channel ABC 15 News in Phoenix (snipurl.com/ng2qk) and reported to the Social Security Administration and members of Congress, who are now conducting additional investigations. Here’s the story’s highlights:675 Social Security managers attended a “motivational management” conference at the Arizona Biltmore Resort & Spa, a high-end Phoenix area resort last week that cost $700,000. The conference’s costs included airfare, hotel entertainment, dancers, motivational speakers, and food. The Social Security Administration provided ABC 15 with a list of courses offered at the conference, which included, “Techniques to Empower You,” Mentoring the Generations,” and “Emotional Intelligence.”A spokesperson from the SSA’s regional office said the conference was essential, that teleconferencing was not an option, and that all 675 managers needed to meet in person. They did put the conference out to bid, and rooms for the conference were booked at $85 per night, versus the rack rate of $400 for a room during the prime tourist season. However, as you might note, it is not prime tourist season in Phoenix in July…..The SSA omitted from their report to ABC 15 that the conference also included an after-hours casino trip, family members staying at the resort, or a dance that was observed by the reporters.”This was a training conference. The location was selected through the government’s competitive bidding process. The facility that was selected was the lowest bidder, and we paid well-below the prescribed government rate.” Leslie Walker, Regional Communications Director, SSA.By the way, Social Security trustees said in May that the program will begin paying out more in benefits than it collects in taxes in 2016, and the program’s trust fund will be depleted by 2037. 2016 is little more than six years away from now….This story offends on so many levels. Let me count just a few of the the ways:-They’re spending my money (and yours) on unnecessary perks and travel when they don’t have the funds. Repeat: they don’t have the money! When was the last time your company sent you to the Biltmore for a few days of motivational training?- Why is there a different standard for the public sector versus the private sector? Since when it is acceptable to “do as I say, but not as I do?”- Haven’t they heard about holding webinars and using GotoMeeting.com as an alternative to personal travel?- Corporations and the banking industry in particular have been vilified by the Obama Administration, who promised during campaigns to cut waste in the government. In fairness, I do recall that Obama announced a 10% cut in the budgets of his director reports in February or March, which resulted in a couple hundred million saved. Yes, we need MUCH more of this kind of action. Every new major legislative proposal is presented as a cost saving initiative, yet how many trillions in debt are we now with no apparent end in sight for additional new Federal programs?- How can these agencies continue to spend money they don’t have? Contrary to what Joe Biden (always interesting) said this week in a speech to the AARP,(snipurl.com/oay25) everyone knows you STOP spending when you go bankrupt; you don’t spend MORE!- Training & developing their managers is OK and economically justifiable for a major benefit program that has no assets that all of us have paid into for many, many years.- What’s happened to fiduciary responsibility in the government? The SEC would throw the SSA execs in jail if it were a private sector agency, based upon the way it’s been managed. Essentially it’s a Ponzi scheme. There are no assets because the government has robbed Peter to pay Paul.- What about the people who’ve paid into FICA for decades, counted on receiving retirement benefits from the SSA, are legitimately disabled, and/or worked in lower level jobs so they didn’t save enough money for retirement? Particularly after the financial “repression” we’ve experienced resulting in drastically reduced 401K balances and housing values, many “would-be retirees” are delaying retirement.The hypocrisy and arrogance of the public sector and our politicians for both parties is just unbelievable to me!! We need leaders who are tough enough to take on the challenge of addressing the fact that the SSA is on the verge of bankruptcy and will fix it so it can be restored to serve its original purpose. It’s been pillaged & plunged for many years, and now we’re seeing the results of that greed and failure to control spending.Several months ago, I wrote about Wells Fargo (snipurl.com/o95ov) buckling to public pressure and canceling their annual employee recognition event scheduled to be held in Las Vegas. They had the money set aside in their budget to pay for this event yet canceled it due to public pressure for TARP recipients regarding compensation practices.What’s good for the goose isn’t good for the gander anymore. I really worry about our future. California’s on the verge of going bankrupt with its recently downgraded credit rating just above junk bond status as our legislators fail to agree on viable budget solutions. Is our nation also at risk for going bankrupt a few years hence? Is the SSA situation simply a foreshadowing of bigger issues to come? How do we get out of this mess?I’m going on vacation for a long weekend…..and hope to be more positive when I return!