Mumbai Police’s Economic Offences Wing (EOW) on September 24 recorded the statement of former IndusInd Bank CEO Sumant Kathpalia in connection with the probe of accounting lapses, police sources told Moneycontrol.
"We have recorded the statement of IndusInd Bank's former CEO, and the preliminary inquiry is on," said a source on condition of anonymity.
This is the third such statement recorded by the Mumbai Police's EOW in this week. Before this, the police have recorded the statement of former IndusInd Bank Chief Financial Officer (CFO) Gobind Jain and Deputy CEO Arun Khurana this week.
Sources added that after analysing the statements, further action will be taken. "If required, EoW may call all three former officials again for questioning."
A WhatsApp message sent to Kathpalia seeking confirmation on the matter remained unanswered till publishing the article.
The irregularities, which were initially detected in the bank’s derivatives portfolio, were later found in its microfinance business as well. This followed the resignation of CEO Kathpalia and Deputy CEO Khurana fromthe bank.
Apart from this, the EOW has also recorded the statement of six to seven employees of the bank in connection with the probe, sources added.
Uncertainty around IndusInd Bank began in March when the lender reported an accounting discrepancy linked to its derivatives portfolio. Subsequent reviews by an external agency and a Board-appointed independent professional firm estimated the adverse accounting impact at Rs 1,979 crore and Rs 1,959.98 crore, respectively.
Further, the Securities and Exchange Board of India's (SEBI) interim order released on May 27 revealed that the management of IndusInd Bank was aware of the derivatives discrepancies 15 months before the lender disclosed them to the exchanges.
SEBI has barred former MD & CEO IndusInd Bank Sumant Kathpalia, former Deputy CEO Arun Khurana and three others for alleged insider trading. SEBI, in its interim order, found that they traded during the existence of unpublished price-sensitive information. The others included Sushant Sourav, Rohan Jathanna and Anil Marco Rao.
SEBI whole-time member Kamlesh Chandra Varshney in his interim order noted that “All the Noticees, viz. Noticee Nos. 1 to 5 are hereby restrained from buying, selling or dealing in securities, either directly or indirectly, in any manner whatsoever, until further orders”.
“The foregoing prima facie observations contained in this Order are made based on the material available on record. The Noticees may, within 21 days from the date of receipt of this Order, file their reply/ objections, if any, to this Order and may also indicate whether they desire to avail an opportunity of personal hearing on a date and time to be fixed in that regard,” the SEBI order said.
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