Ex-Infosys Employee Penalized Rs 12 Lakh For This Shocking Abuse Of Power
An ex-Infosys employee has been heavily penalized for abusing his official privileges, and gaming the system to make quick money.
This can set a new precedent in corporate frauds, all India.
Find out what exactly happened here..
Ex-Infosys Employee Fined Rs 12 Lakh For Insider Trading
Prateek Sarawgi, who worked in Infosys between 16 December 2016 to 15 January 2017 has been penalized Rs 12 lakh by SEBI under the provisions of Prohibition of Insider Trading?(PIT) Regulations.
He was working as associate manager (business finance), and during his tenure, he misused confidential financial information and data to make quick money via buying and selling shares.
The SEBI order stated, “As per the company’s submission, the trading window was closed from December 16, 2016 to January 15, 2017 with regard to financial result for QE December 2016. Thus, it was observed that the noticee had traded in the scrip of Infosys when the trading window was closed,”
The adjudicating officer stated that despite multiple notices, Prateek didn’t reply or acknowledge.
The order stated, “Therefore, I am convinced that the principles of natural justice have been duly followed in the matter, as enough opportunities were provided to the Noticee to reply to the show cause notice (SCN) and to appear for hearing,”
How Confidential Data Was Used For Insider Trading?
Prateek was the Designated Person of the company, and was responsible for making presentations meant for auditors and the Board while announcing quarter results.
Based on the confidential information, he predicted the stock movement of Infosys, and performed insider trading. He bought 100 shares on January 12, 2017 and then again bought and sold 400 share next day.
Now, as per the rules, the trading window for Designated Person of the company was closed between December 16, 2016 to January 15, 2017, since they had insider information about the company revenues and profits.
And this directly impacted the share prices.
This insider trading amounts to cheating and fraud, and SEBI hasn’t taken this activity lightly.
There has been no response from Prateek on this case.
We will keep you updated as more details come in.