Infosys Settles Insider Trading Charges with SEBI

In a development concerning insider trading allegations, Infosys, India’s second-largest IT services exporter, has reached a settlement with the Securities and Exchange Board of India (SEBI).

Details of the Settlement

• Infosys CEO Salil Parekh has agreed to pay a penalty of ₹25 lakh for failing to implement adequate controls to prevent insider trading within the company.
• The settlement resolves the case initiated by SEBI in 2021 against Infosys officials Pranshu Bhutra (Senior Corporate Counsel) and Venkata Subramaniam V. V. (Senior Principal, Corporate Accounting Group), along with six other entities.

Background of the Case

• SEBI’s investigation focused on trading activity by individuals and entities connected to Infosys, including Capital One Partners and Tesora Capital.
• In 2021, SEBI barred these individuals and entities from accessing capital markets for suspected insider trading related to Infosys’ unpublished price-sensitive information (UPSI) for the quarter ending June 30, 2020.
• The alleged UPSI leak pertained to Infosys’ strategic partnership with Vanguard.
• SEBI’s order asserted that the leak resulted in “ill-gotten gains” for those involved.

Infosys’ Response

Infosys has maintained its stance of cooperating with the investigation and had previously announced an internal investigation into the matter.

Resolution and Moving Forward

• The settlement with SEBI signifies the conclusion of this specific investigation.
• This development comes after the Securities Appellate Tribunal (SAT) lifted restrictions imposed by SEBI on Infosys in May 2022.

Importance of the Case

This case highlights the importance of robust internal controls within companies to prevent insider trading and protect the integrity of the Indian capital markets.

About Infosys Ltd

Infosys Ltd is the 2nd largest Information Technology company in India after TCS. The company provides consulting, technology, outsourcing and next-generation digital services to enable clients to execute strategies for their digital transformation. On June 27, 2024, Infosys shares opened at ₹1,540.00 and touched the day high of ₹1,567.75 at 12:55 PM.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.