Top 5 IT scandals of 2009

After the worst recession in US and bankruptcy of Lehman Brothers in 2008, the year 2009 was also not one of the best years for the worldwide IT industry. The global downturn has ruined organizations of all sizes, big and small. In 2009, the IT companies are facing the tough financial situation with little surge in demands and healthy forex rates, but they also receives various scandals that rock corporate houses and the sector as a whole throughout the year.The year was started with the country's biggest corporate fraud, one of the top Indian IT giant was banned by World Bank, insider trading reports and hiring scandal, Intel-AMD deal or the latest Nokia LCD pricing issue. The list is long, but here the feature discusses 5 top scandals in 2009.Satyam Computers: India's largest corporate scamThe year was started with the largest corporate scam of the country. Satyam’s founder, B. Ramalinga Raju, had announced that the company's profits had been overstated for several years. The company’s network covers 67 countries across six continents, employs more than 53,000 IT professionals to serve over 654 global companies, 185 of which are Fortune 500 corporations. Recently, the CBI has filed a supplementary charge sheet against Raju and nine others and pegging the Satyam fraud at Rs 14,000 crore instead of the Rs 7800 crore that Raju had owned upto in January this year.Wipro banned by World Bank After Satyam’s downturn, another major Indian IT services provider, Wipro Technologies faced disgrace. The company had barred by the World Bank for four years from receiving direct contracts from the Bank Group under its corporate procurement program. The bank also added that the IT firm had provided improper benefits to its staff. Wipro’s revenue from World Bank is just $1 million, but more than revenue impact, it brings bad repute to the IT firm.Intel-AMD issue In May this year, EU had fined Intel a record €1.06 billion due to violations of antitrust rules in Europe. The EU ruled that Intel illegally used hidden rebates to squeeze rivals out of the marketplace for CPUs. After that ruling, another similar complaint had filed by New York attorney general Andrew Cuomo, who said that the chip giant spent upto $6 billion to compel PC vendors such as Dell, HP and IBM into using its chips instead of AMD.To resolve all antitrust and patent suits, finally Intel joined hands with AMD and agreed to pay about $1.25 billion. Now AMD and Intel have signed a cross-licensing deal which will last for five years. However, the issue will leave a dark spot on the image and financial health of the largest chip maker in the world.“Insider trading” in IBM In October this year, Securities and Exchange Commission (SEC) of US had charged IBM for the largest-ever hedge fund insider-trading scheme involving Galleon Group founder Raj Rajaratnam. The commission accused six individuals for conspiring to execute trade securities, which include Intel, Google and AMD. Senior VP and head of IBM's systems and technology group, Robert Moffat had been named as a defendant. Nokia blames LCD makers Recently, the world’s largest mobile phone maker, Nokia has sued Samsung Electronics, LG Display, and AU Optronics, over price fixing. It is reported that these users are guilty of plotting and fixing prices of LCD panels.

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