SEBI fines Future Retail Rs 10 lakh for inadequate disclosures

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Future Retail (FRL) has been fined Rs 10 lakh for not making adequate disclosures, in an order issued by SEBI on Thursday.

In the order issued on April 24, the Securities and Exchange Board of India (SEBI) said that the disclosure regarding arbitration proceedings, including the arbitration award, involving a Future Group company was made inadequately and with a delay. The regulator found the entity in violation of several provisions under the Listing Obligations and Disclosure Requirements (LODR) Regulations.

On the entity's violation of the Prohibition of Insider Trading (PIT) Regulations, SEBI's Adjudicating Officer Amit Kapoor wrote, "I note that FRL's disclosure on October 26, 2020 was limited to providing information only with regard to receipt of interim award (arbitration award) from SIAC (Singapore International Arbitration Centre) and did not disclose more details of the interim award."

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He quoted clause 4 of Schedule A of PIT Regulations, which requires an entity to promptly disseminate Unpublished Price Sensitive Information(UPSI) that gets disclosed selectively.

He noted, "However, in the present case, the passing of the interim order was widely covered in various media. However, all the details of the news was not available publicly. It was only after active intervention of Stock Exchanges that the Noticee (FRL) disclosed full details of the initiation of arbitration proceedings, chronology of the events, details of interim order, impact of the interim order and all the direction of SIAC under Regulation 30 of the LODR Regulations on November 1, 2020"

The order stated, "After taking into consideration the facts and circumstances of the case, including the fact that a few of the disclosures, which were required to be made and were not made, pertained to period 2015-2019 and the show cause notice was issued on December 15, 2023, in exercise of powers conferred upon me under section 15-I of the SEBI Act read with Rule 5 of the Adjudication Rules, I hereby impose the penalty of Rs.10,00,000/- (Rupees Ten Lakh Only) under section 15A(b) of the SEBI Act on the Noticee (FRL) for the violations as mentioned above. I find that the said penalty is commensurate with the violations committed by the Noticee in this case."