Employees from Wipro & Infosys face ban by SEBI over insider trading

The case was related to a partnership between Infosys and Vanguard, a US investment firm, which was announced in July last year.

The Securities and Exchange Board of India (SEBI), which regulates the securities and commodity market in India, on Monday, September 27 announced in an interim report that it has banned two employees from trading in stock exchanges on alleged charges of Insider trading of Infosys’s shares after it had announced a deal with U.S based investment firm Vanguard in July last year.

The order issued against the alleged perpetrators has also revealed their identities, naming Ramit Chaudhri, a high-level employee at Infosys Ltd. at the time of the announcement of the Infosys-Vanguard deal, and Keyur Maniar, an employee of Wipro Limited as the two people involved in the case. 

On account of the insider trading charges against them under the SEBI Act and Prohibition of Insider Trading (PIT) Regulations, 2015, “Chaudhri and Maniar are restrained from buying, selling and dealing in securities, either directly or indirectly, in any manner whatsoever until further orders,” the order read.

The order further stated that “if Ramit Chaudhri and Keyur Maniar have any open position in any exchange derivative contracts, as on the date of the order, they can close out/square off such open positions within three months of the date of the order or at the expiry of such contracts, whichever is earlier.”

Furthermore, the order issued by SEBI gave more details on the case and the two accused, stating that Ramit Chaudhri was the Solution Design head of Infosys, associated with the Infosys-Vanguard deal before it was announced to the public on July 14, 2020, and “was reasonably expected to have access or be privy to the Unpublished Price Sensitive Information (UPSI),” making him a prime suspect in the insider trading case and sharing sensitive information with Keyur.

The order revealed that Chaudhri had been in contact with Keyur Maniar via telephonic conversation who “traded in the scrip of Infosys in the F&O segment just prior to the announcement of the Vanguard deal and soon after the announcement, subsequently offloaded/squared off his positions such that net positions were zero.” Subsequently, the share trading earned him an estimated Rs. 2.6 crores. The order said that this trading behaviour was abnormal for Keyur, hence arising suspicion of the two violating the provisions of the SEBI Act and Prohibition of Insider Trading (PIT) Regulations, 2015.

Explaining the connection between the two accused, the order stated that “Ramit had used both his mobile numbers to communicate with Keyur. During the period from January 1, 2020, to September 18, 2020, Ramit and Keyur have made several calls between themselves.” According to SEBI, the two had also previously known each other well as they had worked together in Wipro business process services (BPS) from March 2012 to December 2014.

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