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Tuesday, February 23, 2010

Wipro employee commits $4 Million fraud

Bangalore: IT major Wipro has tightened internal control in the finance division after it was noticed that one of its employees embezzled crores of rupees in the last three years. The employee, who was working in the 'controllership' division within the finance department in the last three years, stole a password and transferred funds from Wipro's account at a bank, reports M.V. Ramsurya and Pankaj Mishra of Economic Times.


Suresh C Senapaty, Wipro's CFO has also confirmed the incident. "This has been a case of embezzlement, which we discovered in December, and it's very unfortunate that this person succumbed to this," he said. According to him, the company has carried out an investigation and is undertaking actions with respect to stricter adherence to processes.

Following this, Wipro has disbanded the controllership unit. Wipro officials have succeeded in recovering about half the money, but will still face a loss of about $2 million. The CFO said the incident did not involve more than one Wipro employee. "Our investigations have revealed that only this employee was involved, and nobody else in the team had any clue," Senapaty said.

Apart from setting up an internal investigation team, Wipro has also taken help from external auditors and investigation experts who will vet its processes and certify the soundness of its controls. Wipro has always taken pride in the sound work ethics of its employees and in the strictness of its controls. "We have to be more alert in monitoring, and we need to tighten the processes for ensuring an early warning system and make it tougher," Senapaty said.

Now, Wipro plans to make it compulsory for its employees to sign an undertaking about sharing of passwords and any unauthorized transactions. The company is also planning to frequently rotate its employees, who are working in sensitive functions within the finance department. Currently, employees in such functions spend around three years before a transfer.

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