The disclosure that Wipro, the third biggest Indian outsourcing company, was banned from doing business with the World Bank for four years in June 2007, does not exactly improve confidence in the sector following the Satyam Computer Services scandal.
The ban was imposed because Wipro allegedly “provided improper benefits” to World Bank staff by offering some of them shares in its 2000 initial public offering. Wipro denies doing anything wrong and says it did little business with the World Bank anyway. Read more
I thought I was tough on hedge funds-of-funds in my column last week. My views were mild compared with David Swensen, chief investment officer of the Yale Endowment Fund. He regards them as “a cancer on the institutional investment world”.
Here is the full quote from an interview in the Wall Street Journal this morning: Read more
There seems to be a coup underway at Citigroup. It has already taken down Robert Rubin, looks as though it will lead to Sir Win Bischoff being replaced as chairman by Dick Parsons, and could culminate in the departure of Vikram Pandit as chief executive.
I say this not from inside knowledge but from reading the stories that broke on Friday, when Mr Rubin’s resignation as director and senior adviser was announced and news leaked that Citi is in talks with Morgan Stanley on divesting Smith Barney, its retail broker. Read more
I wonder what the fall-out of the Satyam fraud will be for that famed, semi-mythical figure, Davos Man (and Woman)?
B. Ramalinga Raju was definitely one of those global types who throng the halls of the World Economic Forum in Davos annually. His photograph can be seen in last year’s booklet of attendees, which I have to hand (disclosure: I am in it too). Read more
My FT column this week is on funds of funds in the wake of the Bernard Madoff scandal. Read more
The admission of fraud at Satyam Computer Services by B. Ramalinga Raju was pleasingly graphic. “It was like riding a tiger, not knowing how to get off without being eaten,” he told shareholders in his resignation letter today.
That is probably an accurate way to describe holding $1bn of fictitious cash on your balance sheet, and finally attempting to swallow up the hole by acquiring two family-owned companies. Perhaps the beast that now swallows up Satyam will be Infosys. Read more
These are depressing times but it is distressing to see how many financiers and business people affected by the credit crisis are being driven to suicide.
One public case occurred before Christmas when Rene-Thierry Magon de la Villehuchet, a French fund-of-funds manager based in New York, killed himself after investing $1.4bn of client money (apparently including $50m of his own) with Bernard Madoff. Read more
Having criticised Steve Jobs of Apple in the past for failing to disclose to investors what was wrong with him, I have to say that I think he has done all that can be expected of him for now.
Mr Jobs’ statement yesterday that his weight loss is due to a hormone disorder that means he has not been digesting food properly has failed to still the speculation. Jeff Bercovici notes that both the Wall Street Journal and the New York Times this morning have interviews with doctors that raise further questions. Read more
It is a small world. Who should I come across in Manhattan this evening but Bernie Madoff?
Actually, that is not strictly true. I had to hang around for five minutes or so to see him appear at his apartment building, returning from his day in court at which prosecutors tried to have his bail revoked. Read more