Infosys initiates internal investigation against staff named in insider trading case, says action will be taken

SEBI order

In an order dated May 31, SEBI banned eight entities and individuals selling and buying securities directly or indirectly until further notice. They were also fined Rs 3.06 crore.

These include two Infosys employees – Pranshu Bhutra, Senior Corporate Counsel, and Venkata Subramaniam VV, Senior Principal, Corporate Accounting Group. The other parties in the case are Amit Bhutra and Bharath C Jain from Capital One Partners and Ankush Bhutra, Amit Bhutra, and Manish Champalal Jain from Tesora.

Analysts and governance experts Moneycontrol spoke to, said that while this in an individual failure and that the company’s governance systems continue to be robust, Infosys needs to emphasise and amplify its values to prevent such slippages in future.

Shriram Subramanian, founder, InGovern Research Services, a proxy advisory firm, said, “This looks like transgression of two senior employees.”

“The company will have to strengthen its way of who has access to unpublished price sensitive information (UPSI) and sensitise people to the seriousness of it. They should also sensitise (employees) on violation of Prohibition of Insider Training (PIT) guidelines,” Subramanian said.

As per SEBI guidelines, Unpublished Price sensitive Information (UPSI) refers to any information that concerns the company directly or indirectly, but is not meant for the disclosure to the larger public. The information is sensitive and can impact the stock market prices.

In this case, the two employees were able to access the UPSI and had shared the information with Capital One and Tesora partners, who had generated illegal gains of Rs 3.06 crore, which has been levied as fine by the SEBI, the order read.