Salil Parekh, the chief executive officer and managing director of Infosys Ltd., has settled charges of insider trading with the Securities and Exchange Board of India. The settlement was reached upon payment of Rs 25 lakh, with the settlement order coming into immediate effect, the market regulator said.
The case dates back to a strategic partnership announcement between Infosys and Vanguard on July 14, 2020. SEBI's investigation revealed that Infosys had not considered certain information as unpublished price-sensitive information, as per the SEBI (Prohibition of Insider Trading) Regulations, 2015. UPSI refers to information that, if generally available, could materially affect the price of a company's securities.
The interim order against two entities involved in the alleged insider trading was passed on Sept. 27, 2021, and confirmed on Dec. 13, 2021. The investigation concluded that Parekh had violated Regulations 9A(1) and 9A(2) of the PIT Regulations, which say that the CEO and other key officials of a listed company must ensure adequate internal controls to prevent insider trading.
Following the investigation, a show cause notice was issued to Parekh on Aug. 3, 2023. Parekh filed a settlement application in response on Oct. 3, 2023, proposing to settle the proceedings without admitting or denying the findings. SEBI accepted this proposal under the SEBI (Settlement Proceedings) Regulations, 2018.
Infosys said on Thursday there is no impact on the company's financial, operational or other activities after the settlement order.
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