As part of an investigation into claims that Cognizant Technology Solutions used L&T to help make illegal payments to Indian government officials from 2013 to 2015, the US government is asking S.N. Subrahmanyan, chairman of Larsen and Toubro Ltd. (L&T), for proof. It is thought that Subrahmanyan, who ran L&T’s building business, paid bribes to speed up the approval process for Cognizant’s office projects in Chennai and Pune.
This request was made soon after Subrahmanyan assumed the position of L&T’s chairman in October 2023, succeeding the lengthy term of A.M. Naik. As part of the inquiry, the US government has also requested statements from four other L&T workers and two former employees of Cognizant.
The Ministry of Home Affairs in India first declined a formal request from the US State Department last year. The US Department of Justice (DoJ) is currently requesting assistance under the Mutual Legal Assistance Treaty (MLAT) between the two countries. The Department of Justice (DoJ) issued a request in January, which was later disclosed in July during court hearings in New Jersey.
The issue revolves around accusations that former Cognizant executives authorized a sum of $3.64 million as bribes to Indian officials in order to expedite the development of the company’s campuses. In 2019, Cognizant had already reached an agreement to pay $25 million in order to resolve accusations that were connected to the US Securities and Exchange Commission. Nevertheless, the Department of Justice (DoJ) has filed charges against two former Cognizant officials, Gordon Coburn and Steven Schwartz, for approving these payments.
Although both executives are refuting the accusations, the Department of Justice (DoJ) is utilizing information presented by Cognizant, including papers and interviews, to construct its argument. The defense counsel for Coburn contended that the trial had to be rescheduled until February 2025 in order to facilitate the procurement of statements from Indian witnesses.
A New Jersey judge has granted a postponement of the trial until March 2025, allowing the US government until November 25 to provide a response about the MLAT request. The trial is anticipated to commence promptly following the process of jury selection in March.
Subrahmanyan, who has been employed at L&T since 1984 and assumed the position of chairperson last year, was interviewed by officials from the United States in 2018. He asserted that he had no recollection of any conversations regarding illicit payments during the relevant timeframe. L&T conducted an internal inquiry and did not find any evidence of misconduct by its senior management.
The controversy centers on allegations that former executives of Cognizant authorized a sum of $3.64 million in bribery to Indian officials in order to expedite the development of the company’s campuses. In 2019, Cognizant had already struck an agreement to pay $25 million to resolve allegations related to the US Securities and Exchange Commission. Nevertheless, the Department of Justice (DoJ) has pressed charges against two former Cognizant officials, Gordon Coburn and Steven Schwartz, for their involvement in the approval of these payments.
The Department of Justice (DoJ) is utilizing information presented by Cognizant, such as papers and interviews, to construct its argument, despite the fact that both executives are refuting the accusations. Coburn’s defense counsel argued that the trial needed to be postponed until February 2025 to enable the collection of statements from Indian witnesses.
The trial has been postponed until March 2025 by a magistrate in New Jersey, which means that the US government has until November 25 to respond to the MLAT request. It is expected that the trial will commence promptly after the jury selection procedure in March.
In 2018, officials from the United States interviewed Subrahmanyan, who has been employed at L&T since 1984 and assumed the role of chairperson last year. He claimed that he had no recollection of any conversations regarding illicit remittances during the relevant timeframe. L&T conducted an internal investigation and did not uncover any evidence of malfeasance by its senior management.
