Sebi penalised Shruti Vishal Vora - found guilty of leaking price sensitive information related to financial results of Wipro, Asian Paints and Mindtree, and Parthiv Dalal for similar action in case of Wipro.
Market regulator Sebi has penalised Shruti Vishal Vora after finding her guilty of releasing unpublished price sensitive information related to financial results of Wipro, Asian Paints and Mindtree through WhatsApp messages prior to official announcement by the company.
Further, it penalised Parthiv Dalal for similar action in case of Wipro earnings.
In separate orders, Securities and Exchange Board of India (Sebi) levied a fine totalling Rs 45 lakh on Vora for her involvement in the three cases, while a penalty of Rs 15 lakh has been imposed on Dalal for Wipro.
Vora has been working in the institutional team at Antique Stock Broking since September 2008 and Dalal has been working as AVP - Sales in the institutional equity team of the same company since January 2015.
Earlier, the regulator penalised Vora and one more person for releasing unpublished price sensitive information (UPSI) related to financial results of Bajaj Auto and Ambuja Cement through WhatsApp messages.
Some news reports had referred to the circulation of UPSI in various private WhatsApp groups about certain companies ahead of their official announcements to the respective stock exchanges.
Against this backdrop, Sebi initiated a preliminary examination in the matter during which search and seizure operation for 26 entities of WhatsApp Group were conducted and about 190 devices, records, among others, were seized.
WhatsApp chats extracted from the seized devices were examined further and while examining the chats, it was found that earnings data and other financial information of around 12 companies was leaked in WhatsApp messages.
Wipro, Asian Paints and Mindtree were among the firms whose quarterly financial results closely matched with the messages circulated in WhatsApp chats.
Accordingly, the regulator carried out an investigation in the matter of circulation of UPSI through WhatsApp messages with respect to three companies to ascertain any possible violation of the PIT (Prohibition of Insider Trading) Regulations during the period December 2016 and May 2017.
Sebi probe found that Vora communicated the UPSI related to revenue as well as profit of Mindtree and Asian Paints for the quarter ended December 2016 and March 2017 respectively to other person(s) through WhatsApp messages.
In the case of Wipro, Sebi found that Dalal had forwarded UPSI pertaining to the IT company's revenues and profit for the December 2016 quarter through WhatsApp message to Vora and she forwarded the same to several other.
It was observed that the financial figures of Mindtree, Asian Paints and Wipro circulated through WhatsApp closely matched with those disclosed subsequently by these companies on exchanges.
Hence, the message related to the three companies would fall under UPSI and such circulation of financial figures through WhatsApp has been considered as communication of UPSI.
Vora, being an insider, had communicated the UPSI relating to three companies to other persons through WhatsApp messages, which is in violation of the provisions of PIT Regulations, for which she is liable for monetary penalty, Sebi said in order passed on Friday.
The regulator, further, said that Dalal also violated insider trading norms.
As per the PIT norms, any person who is in possession of UPSI is regarded as an insider.
Photograph: Dado Ruvic/Reuters