B. Ramalinga Raju, the businessman behind India's biggest corporate scandal, is today preparing to spend as long as ten years behind bars for his part in a £1 billion fraud that has shocked the country.

Mr Raju, the son of a grape farmer, confessed on Wednesday to orchestrating a £1 billion fraud at Satyam, the outsourcing giant he built from scratch over 30 years, by wildly inflating the group's profit margins.

He faces up to 10 years in prison under Indian law for falsifying his company's financial results.

Bharat Kumar, Mr Raju's lawyer said today: "He has said he will submit himself to Indian justice. If it comes to jail, then he is ready for that.

The company also faces legal action in the US where investors have filed two class action lawsuits against Satyam and its management for concocting fictitious financial figures.

Vianale & Vianale and Izard Noble, two law firms representing holders of Satyam's American Depository Receipts, alleged that the company and its senior executives violated US securities law by issuing false and misleading statements.

Mr Raju's lawyer dismissed reports that the Satyam chairman had fled the county. "He is very much in [the southern city of Hyderabad, awaiting justice," Mr Kumar said.

In a letter to the Satyam board, Mr Raju insisted that he had not profited personally through the fraud, which he said began when he fudged the company's figures to smooth over a minor accounting discrepancy.

He went on to describe how the deception spiralled out of control. "It was like riding a tiger, not knowing when to get off without being eaten," he said.

His actions have badly eroded confidence in India's entire corporate governance system and may lead to foreign investors shunning the country, several analysts said. Others have suggested that many of the country's companies badly needed to be jolted out of improper patterns of behaviour.

Saurabh Mukherjea at Noble, the investment bank, said: "Our experiences … suggest that manipulative accounting and aggressive promoter [owner] practices are more common in India than is generally believed to be the case,"

He added: "Many [Indian] firms have become so convinced of their own invincibility that they do not even bother denying irregularities when confronted with the evidence. They simply threaten you."

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