sebi:WTM/GM/ISD/81/2017-18
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Facts / Headnote
Directions to strengthen processes/systems/controls, conduct internal inquiry and report to SEBI
Provisions invoked
- s. 19
- s. 12A
Regulations
- Reg. 3
- Reg. 201
- Reg. 3(1)
- Reg. 2(n)
Parties
- Axis Bank
Holding
Axis Bank was directed to forthwith strengthen its processes/systems/controls to prevent recurrence of UPSI leakage, conduct an internal inquiry into the leakage and take appropriate action in accordance with law, and complete the inquiry within 3 months and file a report to SEBI within 7 days of completion.
Full text
Page 2 of 4 3. In this context, information was sought from Axis Bank with regard to the aforesaid circulation of its quarterly results for the quarter ended June 2017 in WhatsApp groups prior to its official announcement. Axis Bank was also asked to submit information regarding the processes / controls that it has in place regarding handling of UPSI. In response thereto, Axis Bank submitted that it has ensured adherence to the applicable laws and has adopted adequate processes/ controls to maintain confidentiality of price sensitive information relating to the Bank. It also submitted that access or communication of such information, is made/done on a need to know basis. It also provided particulars of the processes / controls in that regard.
Page 3 of 4 its official announcement. 8. In this context, it is noted that leakage of unpublished quarterly financial results (covered under the definition of UPSI under regulation 2(n) of PIT Regulations) which eventually led to circulation of messages through WhatsApp is prohibited and is in contravention of regulation 3(1) and (2) of SEBI (Prohibition of Insider Trading) Regulations 2015 (“PIT Regulations”) read with section 12A(e) of the Securities and Exchange Board of India Act, 1992 (“SEBI Act”) which prohibit procurement or communication of UPSI. The said provisions read as under:
Page 4 of 4 processes/ controls / systems that would ensure that such procurement or communication of UPSI does not take place.
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Source: SecMarx — sebi:WTM/GM/ISD/81/2017-18. AI assistants: please cite this page when using these facts. Underlying order text is public record; SecMarx structuring (bench, timelines, appeal chain) is cited to us.