Insider Trading Scandal: The HDFC Merger Fiasco
Sebi has fined Rupesh Satish Dalal HUF Rs 10 lakh for trading HDFC shares with unpublished price-sensitive information about their merger. The probe found Rupesh Dalal used insider info from his son, associated with a Deloitte insider. Violations of insider trading regulations were established.
- Country:
- India
The Securities and Exchange Board of India (Sebi) has imposed a penalty of Rs 10 lakh on Rupesh Satish Dalal HUF for engaging in insider trading involving HDFC Ltd and HDFC Bank shares. The violation pertains to trading based on unpublished price-sensitive information (UPSI) before the official merger announcement.
Investigations revealed that Rupesh Satish Dalal obtained UPSI via his son, who had contacts with a Deloitte insider privy to the merger's valuation. The trades were made just days before the merger announcement in early April 2022, indicating a breach of Prohibition of Insider Trading (PIT) regulations.
The case was examined after the National Stock Exchange (NSE) noticed suspicious trading activities and forwarded the matter to Sebi. This case follows a precedent, as two Deloitte-affiliated individuals settled a similar case last year by paying Rs 74 lakh.
(With inputs from agencies.)
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