Pricewaterhouse faces two-year ban in Satyam case


11 Jan 2018

2009 Satyam scam: Pricewaterhouse gets 2-year audit-ban from SEBI

Nine years after the Rs. 8,000cr Satyam scam came to light, Securities and Exchange Board of India (SEBI) found Pricewaterhouse Network guilty in the fraud.

SEBI banned the global auditing firm from providing audit services to listed companies for two years, starting Apr'18.

The company was ordered to pay Rs. 13.09cr and 12% per annum interest from Jan'09, around Rs. 14cr.

Here's more.

Two former Pricewaterhouse partners banned, too

The SEBI also barred two former Pricewaterhouse (PW) auditors -S Gopalakrishnan and Srinivas Talluri- from issuing audit certificates to the listed companies for three years. These chartered accountants were in charge of auditing Satyam at the time of the fraud.

SEBI's order

Charged under SEBI's Prohibition of FUTP

Charged under SEBI's Prohibition of FUTP

In a 108-page order, SEBI said any listed company or market intermediary registered with it shall not engage any firm of the PW Network for issuing audit certificate for two years. As the ban comes into effect from FY 2018-19, it wouldn't impact the auditing work for FY 2017-18.

The firms were reportedly charged under SEBI's Prohibition of Fraudulent and Unfair Trade Practices regulations.

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Played no part in the fraud: Pricewaterhouse Network

Pricewaterhouse Network stated, "We are disappointed with the findings of the SEBI investigations and the adjudication order. The SEBI order relates to a fraud that took place nearly a decade ago in which we played no part and had no knowledge of."

PW Statement

SEBI's order not in line with Bombay HC order

Pricewaterhouse Network -the auditing arm of PWC (PricewaterhouseCoopers) India- reiterated that there have been no wrongdoings by its firms in the "unprecedented management perpetrated fraud at Satyam."

The firm also stated that it believed that the SEBI order isn't in line with the Bombay HC's order in 2010.

It added, "We are confident of getting a stay before this order becomes effective."

"Learnt the lessons of Satyam"

Pricewaterhouse Network's statement also said: "We have learnt the lessons of Satyam and invested heavily over the last nine years in building a robust and high quality audit practice, as also confirmed in 2015 by an independent monitor appointed by the US SEC."


PW audited Satyam Computers from 2000-08

PW audited Satyam Computers from 2000-08

SEBI has been investigating if PW had a role in the Satyam Computers fraud by concealing the scam that came to light on 7 January 2009 when Satyam Founder-Chairman Ramalinga Raju had admitted that the company's books were cooked up for eight years.

The regulator's objective was to prove PW's fraud or connivance with Satyam promoters in falsifying the accounts.


Pricewaterhouse challenges SEBI's authority, jurisdiction in SC

After the scandal broke, Price Waterhouse moved the Supreme Court to challenge SEBI's jurisdiction and authority in investigating against it; the SC, however, didn't stall investigations.

Last year, the SC gave two extensions to SEBI to complete its investigations.

In 2009, PW moved a consent plea with SEBI, which was rejected. In Sep'17, the audit firm again filed a consent plea with SEBI.

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Satyam Scam




Price Waterhouse Network (PWC)


Bombay HC

Exchange Board


FY 2017-18

FY 2018-19


Price Waterhouse

Pricewaterhouse Network


PW Network


Ramalinga Raju

Satyam Computers

Satyam Founder-Chairman Ramalinga Raju


Securities and Exchange Board of India

Srinivas Talluri

Supreme Court

Unfair Trade Practices


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