7 months ago
SEBI Accuses Executives in Yes Bank Insider Trading Case
The stock price of Yes Bank dropped by about 3% after reports that the market regulator, SEBI, has accused some executives of insider trading.
This happened because of a big investment in Yes Bank by two companies, Carlyle Group and Advent International, in 2022.
Some people, including friends and family of the executives, allegedly traded Yes Bank shares using secret information about this deal before it was made public.
SEBI has asked these people and companies, including EY and PwC, to explain why they should not be punished.
If found guilty, they could face fines or be banned from trading.
The case is unusual because it involves senior executives at global consulting firms and large private equity firms in connection with a capital raising transaction.
Yes Bank's stock dropped 2.77% to Rs 21.04 amid regulatory scrutiny.
SEBI issued a show-cause notice to executives from EY, PwC, Carlyle Group, and Advent International.
Allegations involve sharing unpublished price-sensitive information (UPSI) about a $1.1 billion investment in July 2022.
19 individuals are accused, including those who traded on privileged tips and those who leaked the information.
SEBI found that EY and PwC failed to maintain a 'restricted list' to prevent trading in client shares.
- Who
- SEBI, Yes Bank executives, Carlyle Group, Advent International, EY, PwC
- What
- Insider trading allegations related to Yes Bank's 2022 capital raise
- Where
- India
- When
- Scrutiny traces back to July 2022, notice issued in November 2023
- Why
- Alleged sharing of unpublished price-sensitive information (UPSI) and trading on privileged tips
Accused Parties
SEBI
Compliance with Regulations
Accused Parties
Executives from EY and PwC claim they followed internal trading policies and did not violate any regulations.
SEBI
SEBI alleges that EY and PwC failed to maintain proper restricted lists and compliance processes, allowing insider trading.
Confidentiality of Information
Accused Parties
The accused firms and individuals maintain that they did not share unpublished price-sensitive information intentionally.
SEBI
SEBI asserts that confidential information was shared, leading to unlawful trading gains.
Key facts
- Stock Price Drop
- 2.77% to Rs 21.04
- Investment Amount
- $1.1 billion
- Investors
- Carlyle Group, Advent International
- Stake Purchased
- 10%
- Number of Accused
- 19 individuals
- Regulatory Notice Issued
- November 2023
- Accused Firms
- EY, PwC, Carlyle Group, Advent International
Quotes
SEBI
The Securities and Exchange Board of India (SEBI) is the regulatory body for the securities market in India.
“No restriction was ever imposed on trading or investing in listed companies with which EY was engaged for advisory, consulting, valuation, investment banking or corporate finance services (other than audit).”
financialexpress.com
