Bengaluru-based information technology (IT) services firm Infosys, said on Tuesday it has initiated an internal investigation after market regulator Securities and Exchange Board of India (SEBI) barred two of its employees from trading in public markets on charges of insider trading sourced from latest news.
The Infosys employees under investigation are Pranshu Bhutra, senior corporate counsel, and Venkata Subramaniam, senior principal, corporate accounting group.
In a statement to the Bombay Stock Exchange, Infosys said it was notified of an interim ex-parte SEBI order on June 1.
“The Company will offer its full cooperation as required to SEBI on this matter. Further, as a result of the matter, an internal investigation is initiated and appropriate action will be taken on the conclusion of such investigation,” as per Infosys News Sources.
In the order, SEBI prohibited eight parties from selling or buying securities directly or indirectly until further notice.
All eight entities traded in the scrip of Infosys while in possession of unpublished price-sensitive information (UPSI) related to the company's financial results for the quarter ended June 30, 2020, according to an interim order from the regulator on Monday.
“There is ample prima facie evidence which demonstrates that the entities have violated the SEBI Act and the Prohibition of Trade in Confidential Information (PIT) regulations. This not only violated the integrity of the market but also prima facie resulted in undue benefit to them over general investors" the SEBI order said.
SEBI in its investigation discovered that Pranshu Bhutra was connected to a person named Amit Bhutra through frequent phone conversations. According to SEBI Latest News, Pranshu had a fund transaction with Mahrishi Alloys Private Limited (Mahrishi), and soon after Mahrishi had a fund transaction with Shyama Devi Bhutra (Amit's mother) and Ram Bilas Putra (Pranshu’s father).
In addition, a long-duration call between Subramaniam and Pranshu on July 2, 2020 (a few days after UPSI came into existence) and on July 9, 2020 (i.e. one day before Capital One begins operations), leads at first glance to a preponderance Possibly, Subramaniam, who owned UPSI, first disclosed UPSI to Pranshu in some form or manner. Therefore, Subramaniam ostensibly violated the provisions of Section 12A(e) of the SEBI Act 1992 and Regulation 3(1) of the PIT Regulations," the SEBI order said.
The market regulator ordered immediate action to protect investors and the securities market from further harm.
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