Sebi, Infosys CEO Salil Parekh Reach Agreement On Insider Trading Allegations
The settlement proposal, not admitting to the findings, involved a payment of Rs 25 lakh to Sebi
The Securities and Exchange Board of India (Sebi) has concluded a settlement agreement with Salil Parekh, the CEO and MD of Infosys, in connection with allegations of insider trading.
The case, initiated following an ad interim ex parte order in September 2021, focused on Parekh's actions during the period from June 2020 to September 2021. Sebi's investigation centered on Infosys’ announcement of a strategic partnership with Vanguard in July 2020, which was deemed Unpublished Price Sensitive Information (UPSI) under Sebi regulations.
Regulation 2(1)(n)(iv) of the Sebi (Prohibition of Insider Trading) Regulations, 2015, highlighted the strategic importance of the partnership for Infosys, potentially influencing the company’s business expansion and financial outcomes. The investigation concluded that Parekh, as CEO and MD, failed to maintain adequate internal controls to prevent insider trading, violating Regulations 9A(1) and 9A(2) of the PIT Regulations, 2015.
In response to a Show Cause Notice issued in August 2023, Parekh opted to settle the proceedings under the SEBI (Settlement Proceedings) Regulations, 2018. The settlement proposal, not admitting to the findings, involved a payment of Rs 25 lakh to Sebi.
The High Powered Advisory Committee (HPAC) endorsed the settlement terms in March 2024, which were subsequently accepted by Sebi's Panel of Whole Time Members in May 2024.
