Infosys CEO Salil Parekh settled charges of insider trading violations with the Securities and Exchange Board of India (SEBI) by agreeing to pay a fine of INR 25 lakh (approximately $30,000).
The High Powered Advisory Committee (HPAC) recommended the settlement, which SEBI’s Panel of Whole Time Members accepted on May 21, 2024. The payment was executed on June 7, and SEBI subsequently confirmed receiving the amount, as per the market regulator.
Infosys Settles Insider Trading Case
Reuters reported that Infosys CEO Salil Parekh reached a settlement with the Securities and Exchange Board of India (SEBI) regarding allegations of insider trading violations. SEBI conducted an investigation covering the period from June 29, 2020, to September 27, 2021, which uncovered violations of the SEBI Act and Prohibition of Insider Trading (PIT) Regulations, 2015, by Infosys. The investigation found that Infosys had failed to classify certain information appropriately as Unpublished Price Sensitive Information (UPSI), which is crucial under regulatory guidelines.
Insider Trading Violations Settlement Involving Infosys CEO Salil Parekh
As CEO and Managing Director, Parekh bore responsibility for implementing effective internal control systems to ensure compliance and prevent insider trading.
The settlement, which SEBI’s Panel of Whole Time Members accepted on May 21, 2024, involved Parekh agreeing to pay a fine of INR 25 lakh (approximately $30,000). It’s important to note that settling the proceedings does not imply an admission of guilt, as Parekh proposed to settle without admitting or denying the charges.
Infosys-Vanguard Partnership and Insider Trading Case
SEBI’s investigation found that Infosys considered its partnership with Vanguard in 2020 crucial for business expansion and revenue growth. However, Infosys failed to classify this information as Unpublished Price Sensitive Information (UPSI) under the PIT Regulations, 2015.
SEBI is expected to vote on new regulations for unregistered financial influencers (finfluencers) at its board meeting today. The proposed rules aim to restrict revenue models of unregistered finfluencers, prevent SEBI-regulated entities from collaborating with them, and mandate registered finfluencers to display credentials.
Infosys Advances in Artificial Intelligence
At Infosys’ 43rd annual general meeting on June 26, Chairman Nandan Nilekani revealed significant progress in artificial intelligence. Infosys is developing 225 generative AI programs for its clients and has trained over 250,000 employees in GenAI technologies.
In addition, the company has filed over 46 AI patents and supported 70 AI client projects in FY24, solidifying its leadership in the enterprise AI sector.
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