Wipro not looking to file complain against CA employee who siphoned off around $4 million

 

Feb20,2010

Wipro, the information technology to soaps conglomerate, 

says it is unlikely, at least for now, to file a formal complaint 

against the employee who recently siphoned off 

around $4 million (around Rs 18 crore) from the 

company’s bank account by accessing a colleague’s password.

Instead, it says it is satisfied with the progress it has made by
resorting to ‘dialogue’ with the employee as suggested by
an internal investigation team, aided by external counsels.
Based on the suggestions of the team, the company claims
it managed to recover almost half the siphoned money.

The company said the employee had been dismissed after
the fraud came to light but did not comment on his whereabouts.

“We have an investigation team which is looking at the matter.
Based on its recommendations, we have taken, and are taking
appropriate action, against the said employee,”
Rajendra K Shreemal, VP and Corporate Treasurer of Wipro told .
He added that the company had not filed a case either with the
local police or with the state police’s cybercrime cell against the
employee. The cybercrime cell confirmed this.

A qualified chartered accountant (CA), the ‘fraudster’ had

joined Wipro a little over three years ago, and this was his first job.

He was a junior employee in Wipro’s multimember ‘Controllership’
division in the finance department, which is responsible for maintaining
its financial books and has powers to authorise payments.

Though he reported to the chief controller, a person familiar with the
structure in Wipro’s financial department said “he was given
an independent role in the company’s treasury department” as
the company considered him “extremely intelligent” and “trustworthy”.

“However, history has taught us that ‘brainy and smart guys’
commit financial frauds and so has been the case with Wipro”.

Had Wipro done a proper background verification of the employee?
Shreemal says: “He was very good, with a good family background
and reference. This is just a one-off case, and this was clearly a use
of non-adhering to company policy.”

Experts say while the role of the audit committee that failed to get
a whiff of the happenings is under question, this has also raised
doubt about the internal audit system in the company.

A chartered accountant, who wished not to be named, said:
“Big organisations like Wipro have a strong internal audit
division which reports directly to the company chairman.

It falls within their ambit to check financial misappropriation
like this, since this might have happened off the balance sheet
and hence which did not enter the audit.”

Meanwhile, Wipro replaced all employees in the affected
division, which is also normally due at some stage.
The leadership of the controllership division was also changed.