BLOWING THE WHISTLE, ONCE TOO OFTEN...
2013
Infosys agrees to pay $34 million to end a United States investigation related to the widespread practice of Indian firms of flying workers to client sites in the US on temporary visas. The settlement, according to the US Justice Department, was the largest in a case of alleged civil fraud over visas. The case had been brought to light by whistle-blower Jack Palmer in 2011.
The Justice Department had alleged that Infosys knowingly and unlawfully sent people to work without proper visas and that there were alleged widespread failures in the company’s record-keeping and that the company reportedly tried to deceive U.S. consular officials with false “invitation letters”, which tell the government the purpose of travel.
Infosys agreed in the settlement that it committed civil violations of US employment law but that it was not required to admit and did not admit to further wrongdoing. “Infosys denies and disputes any claims of systemic visa fraud, misuse of visas for competitive advantage or immigration abuse. Those claims are untrue and are assertions that remain unproven,” said the company in a statement.
2017
A whistleblower alleged profiteering from Panaya, a $200 million acquisition by the company. Described by then CEO Vishal Sikka, the first non-founder to assume that position, as one of his greatest strategic achievements, the “current board,” alleged the whistleblower, had described them as dud investments. These claims had been rubbished by Sikka. The whistleblower then filed complaints with SEBI and the Board of the company. The whistleblower alleged that shareholders’ approval had not been obtained for paying Rajiv Bansal a severance package that was 30 times more than required. “That is a big blatant violation of every principle of corporate governance... it is a violation of the SEBI and Companies Act. It is a violation of US SEC laws,” he / she had said.
2018
Salil Parekh takes charge as CEO April 2018: The whistleblower from 2017, in a letter to the SEBI Chairman, had said, “I have written several letters on the shady acquisitions done by the earlier board of Infosys and tried to bury the whole issue by undertaking managed investigations and paying some hush money to earlier CFO Rajiv Bansal.” This was with regard Ultimately, the saga led to board Chairman Sesasayee and Vishal Sikka stepping down from their positions and Nandan Nilekani and Salil Parekh taking charge as Chairman and CEO respectively.
May 2018: Another whistleblower writes to the securities market regulators in India and the US, after the company had announced its intention to sell Panaya and Skava by March 2019. Although former CEO Vishal Sikka had stepped down following the controversy, the whistleblower turned his guns on Chairman Nandan Nilekani, accusing him of “conniving with the current board to quietly bury all the wrongdoings of the earlier board.” The fact that Sesasayee and Sikka had signed “non-disparagement” obligations, said the whistleblower, indicated that wrongdoings had been found in the investigation reports, “the release of which will be a damning indictment of the company and those directors.”