Watch India's Big Corporate Liar
The head of one of India's biggest I.T. outsourcing firms quit today, saying that he cooked his company's books to inflate profits for years, a scandal that the Indian media is instantly dubbing "India's Enron."
Raju was a hero of the great Indian Tiger, an economy that grew at an 8.5 percent clip last year.
He was also a go-to guy for the Western business media. We found two video interviews Raju gave to CNBC in November, which -- given today's shocking news -- are pretty amazing to watch. See if you can spot any liar tells.
Here's his most recent CNBC interview, from Nov. 6, 2008, in which talks about his company's second-quarter earnings, which jumped 42 percent (amazing!) over the previous year.
He did allow, however, that he had to lower his company's earnings guidance by 2 percent. Keep in mind that he was lowering the guidance -- on totally fake numbers!
And here's a Nov. 3, 2008, Raju interview with CNBC's Erin Burnett.
Of course, Burnett did not ask Raju: "Are you lying about your company's earnings?" No one does. But these days, maybe that should be the first question every business journo asks a chief executive.
The Ticker e-mailed Burnett today to ask her what she thinks about this interview in retrospect, given today's news.
"To be honest, I didn't have any 'sixth sense' that he was a fraud," Burnett e-mailed The Ticker. "I rewatched the interview this morning and did not see anything that seems 'telltale' in hindsight either. Had we been focusing on the numbers exclusively -- would that have been different? Likely not. He's been a guest on CNBC over the years and he was used to telling his story."
The Ticker asked Burnett if she'd chatted with Raju off-camera.
"Off-camera we talked about his meeting with investors in New York (that was why he was visiting the U.S. for a few days)," she wrote. "He was rather animated -- we were talking about my India visit and his meeting schedule."
Massive fraudsters like Raju and Madoff pass off so easily as truthful because they end up believing their lies. Until they don't.
In the Dept. of Irony, the name of Raju's company (Satyam) -- whose stock fell in value 80 percent after his resignation -- is Sanskrit for "truth."
January 7, 2009; 2:52 PM ET
Categories: The Ticker | Tags: Raju, Satyam
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