Indian Suppliers Wipro, Megasoft Consultantsand Satyam have
beenbarred by the World Bank.
The World Bank published a
list of three Indian IT service providers barred from selling
to it yesterday.
Indian IT services providers Wipro, Megasoft Consultants and
Satyamare currently banned from doing direct business with the
World Bank because of conflicts of interest.
On 25 December 2008 the World Bank barred Satyam, the company at
the centre of a $1bn accounting fraud, for eight years for
"providing improper benefits to World Bank staff and failing to
maintain documentation to support fees charged for its
subcontractors," said the World Bank.
The Wipro ban was first placed in June 2007 and will continue
until at least 2011. It was barred for providing improper benefits
to bank staff. World Bank employees and family and friends bought
1,750 Wipro shares for about $72,000, said Wipro in a
statement.
Megasoft Consultants was banned for four years in December 2007
for "participating in a joint venture with bank staff while also
conducting business with the bank."
The transparency of the Indian IT service industry is
being called into question following news of a huge internal
fraud. Satyam Chairman B Ramalinga Raju, was arrested by Indian
police on Friday after
admitting that he had fiddled the company's books for several
years. The revelation came in a letter to the company last
week, in which Raju offered his resignation and confessed to
inflating the company's financial figures.
Global customers of Indian IT suppliers are questioning the
transparency of their suppliers following last week's scandal.
"The World Bank Group has decided to make public the names of
all companies that have been debarred from receiving direct
contracts from the Bank Group under its corporate procurement
program. This change was made in the interest of fairness and
transparency," said a World bank statement.