India Names Three to Satyam Board

By Sam Dolnick

NEW DELHI -- Indian authorities on Sunday named three business leaders to help rescue embattled outsourcing giant Satyam Computers(SAY Quote) in the wake of a massive fraud scandal that threatens to sink the company.

Corporate Affairs Minister Prem Chand Gupta tapped experts in technology, finance and law to form the core of a new board for the company, which in the past week has seen its leadership arrested and its board dissolved.

Satyam is fighting for its life after founder and Chairman B. Ramalinga Raju confessed to doctoring the company's accounts by $1 billion and filling the company's balance sheets with "fictitious" assets and "nonexistent" cash.

Raju, along with his brother, a former managing director, and the former chief financial officer, have been arrested and charged with criminal conspiracy, forgery, criminal breach of trust and falsifying documents. They face up to life in prison, police said.

Police were questioning the three in the southern city of Hyderabad on Sunday, said senior police official V.S.K. Kumudi.

Satyam, which is headquartered in the southern Andhra Pradesh state, employs 53,000 people -- among the 2 million Indians working in the country's booming high-tech industry, which last year brought in an estimated $40 billion. The company's clients include a slew of Fortune 500 companies including Nestle, General Electric(GE Quote) and Ford Motors(F Quote).

"The board's first priority would clearly be to restore the company's credibility, customer confidence and employee morale," said Gupta. "Such a board will provide the necessary vision, along with responsible and accountable leadership to the company in this hour of crisis," he added