SEBI Orders Suspension Of Embassy Office Parks CEO Aravind Maiya
Aravind Maiya’s suspension as CEO of Embassy Office Parks follows SEBI's directive after NFRA's report identified negligence during his auditing of Coffee Day Enterprises.
The market regulator, SEBI, has directed Embassy Office Parks Management Services to immediately suspend Aravind Maiya as CEO following findings from the National Financial Reporting Authority.
The NFRA findings identified negligence on Maiya’s part during his previous role in auditing Coffee Day Enterprises Ltd.
SEBI’s order, issued as a temporary measure, requires the company to appoint a CEO for the time being who meets the “fit and proper” criteria essential for leadership positions in SEBI-regulated entities. The suspension will remain in effect until further instructions are issued.
This decision is related to SEBI’s investigation into violations within Coffee Day Enterprises, where funds were allegedly diverted to a related entity, Mysore Amalgamated Coffee Estates Ltd., without necessary corporate approvals.
Findings indicated that over Rs 3,000 crore were transferred from Coffee Day’s subsidiaries to MACEL, a company linked to the late CDEL founder, VG Siddhartha. The fund diversion was found to have been concealed from Coffee Day’s investors, leading to considerable losses in share value upon the fraud’s revelation.
During this period, Maiya was a partner at BSR & Co., the auditing firm responsible for Coffee Day’s financial compliance. The NFRA cited that the audit process had failed to adequately detect or disclose these major financial irregularities.
SEBI found that Maiya’s oversight in the audit process, compounded by NFRA’s findings of “gross negligence,” rendered him ineligible to continue as CEO under SEBI’s “fit and proper” requirements.
SEBI emphasised that this measure aims to protect the interests of investors and maintain trust within the securities market, underscoring the importance of leadership accountability within companies managing public funds.
While Maiya has reportedly appealed the NFRA’s decision, the suspension will hold unless a court order explicitly overturns the NFRA's findings or SEBI issues new directions.
