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SEBI sends show-cause notices to 141 staff of Titan Company Limited alleging violations

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SEBI (Prohibition of Insider Trading) Regulations, 2015 in the background of Chief Justice N K Sodhi Committee Report Report (See Para 77 of Report at https://lnkd.in/dyqS-z2C) mandated trades disclosure threshold at a value of INR 10,00,000 or more in a calendar quarter. 100s of orders have been passed by SEBI since then and the saga continues.

From The Economic Times it seems that SEBI has issued notices to more than 100s of staff of one company for violation of Regulation 7 of Insider Trading Regulations (https://lnkd.in/dPB6se9r).

Mr. Sumit Agrawal of Regstreet Law Advisors who was part of Justice Sodhi Committee and a former SEBI Officer, views that there are many employees who are not from finance or law backgrounds and who may not even be aware of these compliances. The idea of creation of such requirement was never to burden employees but listed companies to monitor trading and disclosures of its employees. Companies need to strengthen its compliance in the context of disclosures by designated persons, contra-trades, seeking pre-clearance, transacting when trading window is closed, and exercise of ESOPs.

Food for thought for securities law enthusiasts: Since ignorance of law is not an excuse, what kind of argument in law can be taken? Whether liability of an employee is primary or secondary? Assuming that the numerous employees in a particular period face allegations but not the employer, or vice-a-versa, does it create a legal defense and are there precedents?

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