{"id":1302478,"date":"2025-11-13T06:52:46","date_gmt":"2025-11-13T01:22:46","guid":{"rendered":"https:\/\/trak.in\/stories\/?p=1302478"},"modified":"2025-11-13T06:53:16","modified_gmt":"2025-11-13T01:23:16","slug":"indusind-bank-will-take-back-salary-bonuses-of-ex-employees-over-misconduct","status":"publish","type":"post","link":"https:\/\/trak.in\/stories\/indusind-bank-will-take-back-salary-bonuses-of-ex-employees-over-misconduct\/","title":{"rendered":"IndusInd Bank Will Take Back Salary, Bonuses Of Ex-Employees Over Misconduct"},"content":{"rendered":"\n<p>In a rare and bold move within India\u2019s banking sector, <strong>IndusInd Bank<\/strong> has initiated a <strong>clawback process<\/strong> to recover salaries and bonuses paid to its former top executives \u2014 <strong>ex-CEO Sumant Kathpalia<\/strong> and <strong>deputy CEO Arun Khurana<\/strong> \u2014 following internal findings of <strong>misreporting and misconduct<\/strong>.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"575\" src=\"https:\/\/trak.in\/stories\/wp-content\/uploads\/2025\/11\/Screenshot-2025-03-11-at-8.51.25-AM-1024x575-1.png\" alt=\"IndusInd Bank Will Take Back Salary, Bonuses Of Ex-Employees Over Misconduct\" class=\"wp-image-1302484\" srcset=\"https:\/\/trak.in\/stories\/wp-content\/uploads\/2025\/11\/Screenshot-2025-03-11-at-8.51.25-AM-1024x575-1.png 1024w, https:\/\/trak.in\/stories\/wp-content\/uploads\/2025\/11\/Screenshot-2025-03-11-at-8.51.25-AM-1024x575-1-300x168.png 300w, https:\/\/trak.in\/stories\/wp-content\/uploads\/2025\/11\/Screenshot-2025-03-11-at-8.51.25-AM-1024x575-1-768x431.png 768w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Internal Probe Uncovers Accounting Misstatements<\/strong><\/h3>\n\n\n\n<p>The decision follows an <strong>internal review<\/strong> that identified <strong>accounting irregularities in derivative trades<\/strong>, which led to a <strong>$230 million financial hit<\/strong> to the bank\u2019s books earlier this year. The findings prompted the abrupt resignations of <a href=\"https:\/\/hr.economictimes.indiatimes.com\/news\/industry\/indusind-bank-looks-to-claw-back-salary-bonuses-of-former-top-officials\/125243747?utm_source=Mailer&amp;utm_medium=newsletter&amp;utm_campaign=ethr_news_2025-11-12&amp;dt=2025-11-12&amp;em=bW9odWxAdHJhay5pbg==\">Kathpalia and Khurana in <strong>May 2025<\/strong><\/a>, both of whom now face <strong>regulatory scrutiny<\/strong> from the <strong>Securities and Exchange Board of India (SEBI)<\/strong> and <strong>enforcement agencies<\/strong>.<\/p>\n\n\n\n<p>According to sources quoted by Reuters, the <strong>IndusInd Bank board<\/strong> sought <strong>legal advice<\/strong> on applying clawback clauses as per its internal code of conduct and the <strong>Reserve Bank of India (RBI)<\/strong>\u2019s 2019 guidelines, which allow banks to reclaim pay from executives found guilty of misconduct.<\/p>\n\n\n\n<p>The internal review reportedly cited <strong>\u201caccounting misstatements, failure of internal controls, regulatory breaches, and non-compliance with RBI norms\u201d<\/strong>, describing these as actions causing reputational and financial damage to the bank.<\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Clawback Period and Potential Impact<\/strong><\/h3>\n\n\n\n<p>The clawback is expected to cover the period between <strong>December 2023 and March 2025<\/strong>, though the total recovery amount remains undisclosed.<br>According to the bank\u2019s annual report for FY2025, Kathpalia\u2019s fixed pay stood at <strong>\u20b975 crore ($8.5 million)<\/strong>, while Khurana earned <strong>\u20b950 crore<\/strong>, in addition to stock options and bonuses that may also be subject to recovery.<\/p>\n\n\n\n<p>Clawback enforcement, though provided for under Indian banking rules since <strong>2019<\/strong>, has rarely been implemented \u2014 with only two known cases before this. However, employees may legally challenge such recoveries, potentially leading to a prolonged dispute.<\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Ongoing Regulatory Investigations<\/strong><\/h3>\n\n\n\n<p>Both former executives are currently <strong>barred from trading in securities markets<\/strong> as SEBI investigates allegations of <strong>insider trading<\/strong>. Meanwhile, the new IndusInd Bank CEO has confirmed that an <strong>internal accountability exercise<\/strong> and a <strong>major organisational overhaul<\/strong> are underway to prevent such lapses in the future.<\/p>\n\n\n\n<p>The bank has also established an <strong>internal panel<\/strong> to strengthen financial oversight, compliance, and risk management systems.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>In a rare and bold move within India\u2019s banking sector, IndusInd Bank has initiated a clawback process to recover salaries and bonuses paid to its former top executives \u2014 ex-CEO Sumant Kathpalia and deputy CEO Arun Khurana \u2014 following internal findings of misreporting and misconduct. Internal Probe Uncovers Accounting Misstatements The decision follows an internal [&hellip;]<\/p>\n","protected":false},"author":30,"featured_media":1302484,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[8956],"class_list":["post-1302478","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-indusind"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.9 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>IndusInd Bank Will Take Back Salary, Bonuses Of Ex-Employees Over Misconduct - Trak.in - Indian Business of Tech, Mobile &amp; Startups<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/trak.in\/stories\/indusind-bank-will-take-back-salary-bonuses-of-ex-employees-over-misconduct\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"IndusInd Bank Will Take Back Salary, Bonuses Of Ex-Employees Over Misconduct - Trak.in - Indian Business of Tech, Mobile &amp; Startups\" \/>\n<meta property=\"og:description\" content=\"In a rare and bold move within India\u2019s banking sector, IndusInd Bank has initiated a clawback process to recover salaries and bonuses paid to its former top executives \u2014 ex-CEO Sumant Kathpalia and deputy CEO Arun Khurana \u2014 following internal findings of misreporting and misconduct. 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