India's securities regulator enhanced disclosure rules Wednesday, the first sign of regulatory reform in the wake of a $1 billion fraud scandal at Satyam Computer Services Inc, one of India's largest outsourcing companies. "There are quite a few things we will learn from this episode in terms of what improvements our system needs,' C.B. Bhave, chairman of the Securities and Exchange Board of India, told reporters after a board meeting in Mumbai.
He said that going forward, the controlling shareholders of a company will have to disclose how many of their shares they have pledged as collateral. Pledged shares played a key role in Satyam's demise, according to the company's disgraced founder and former chairman B. Ramalinga Raju. On January 7, Raju confessed to doctoring the company's books for years, fabricating, among other things, $1 billion in fictitious cash deposits.