SEBI Imposes 10 Lakh Rupees Fine on T.A.N Murti for Violation of Insider Trading Norms
The infamous Satyam Scam is in the limelight again. After more than a decade, the Securities and Exchange Board of India has levied a fine of Rs 10 lakh on T.A.N Murti for insider trading.
Mr Murti was the head of investor relations at Satyam Computer Services Ltd.
The details of Satyam Computer Services Ltd.'s financial fraud (commonly known as Satyam Scam) were discovered in 2009. At the time, it was termed as the country's biggest corporate fraud.
What is Insider Trading?
Insider trading is an illegal practice of trading in stocks. In this type of trading the person trades to his own advantage through having access to insider information that can affect the price. This information is known as unpublished price sensitive information (UPSI).
SEBI's Investigation
SEBI in its investigation into the charges discovered that Mr Murti traded in shares of Satyam Computers in December 2008. While trading, he was in possession of unpublished price sensitive information. Thus, Mr Murti was found guilty of violating insider trading norms.
His actions on December 15, 2008, made it evident that he had access to confidential information. On that day, he sold 14,500 SCSL shares. This was ahead of the acquisition of Maytas Infra Ltd. (MIL) and Maytas Properties Ltd. (MPL) by SCSL.
SEBI stated that it is well established that Mr Murti was aware that SCSL was going to acquire two companies and a proposal was put to the board on December 16, 2008, when he was a key SCSL personnel.
