SEBI finds Bank of America shared confidential information ahead of 2024 block trade: Report

SEBI's so-called "show cause notice" said that the bank's deal team shared price-sensitive information with employees who were not directly involved with the deal, according to the report.

• SEBI accuses Bank of America of leaking non-public info on $180M block trade
• BofA allegedly misled SEBI and failed to protect confidential deal information
• BofA may seek a multimillion-dollar settlement without admitting wrongdoing

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Markets regulator Securities and Exchange Board of India (SEBI) has found that Bank of America improperly shared material non-public information about a $180 million block trade of stock and misled the authorities about it, the Wall Street Journal reported on Wednesday, citing people familiar with the matter.

SEBI accused BofA in November of improperly sharing information related to the sale of shares in Indian asset manager Aditya Birla Sun Life AMC in 2024, the report said.

SEBI's so-called "show cause notice" said that the bank's deal team shared price-sensitive information with employees who were not directly involved with the deal, according to the report.

The regulator also accused the bank of providing false statements to its investigators after they inquired about the alleged leak and said the bank had failed to build appropriate guardrails to protect confidential information about capital-markets transactions from leaking, the report said.

BofA is preparing a response to SEBI's accusations and is expected to seek a settlement in the millions of dollars without admitting or denying wrongdoing, the Journal reported.

Reuters could not immediately verify the report. SEBI did not immediately respond to Reuters' request for comment outside business hours. BofA declined to comment.

The Journal first reported a whistleblower complaint alleging the leak in 2024, but a BofA spokesperson had then told Reuters that it had found no evidence to support the claims.

Sharing non-public information ahead of an announcement can allow some investors to profit from expected price moves. The practice is illegal in India and several other markets.After initially telling SEBI that its processes related to the block trade were above-board, BofA later corrected the record with the regulator following its own internal probe and turned over records showing people outside the deal team had communicated with investors about the deal, the Journal reported on Wednesday.