Synopsis
The Securities and Exchange Board of India (Sebi) has issued show-cause notices to 141 employees of Titan, India’s largest watch and jewellery retailer, alleging violation of insider trading rules, said a person with knowledge of the matter.
Mumbai: The Securities and Exchange Board of India (Sebi) has issued show-cause notices to 141 employees of Titan, India’s largest watch and jewellery retailer, alleging violation of insider trading rules, said a person with knowledge of the matter.
The regulator’s enquiry showed these employees did trades in stocks and derivatives of value exceeding ₹10 lakh in FY19 but did not disclose them to the company as part of compliance rules. Sebi rules require a company’s promoters, employees and directors to disclose to the company the number of securities bought or sold within two trading days of transactions if the value of the securities traded – one-time or a series of transactions over any quarter – exceeds ₹10 lakh.
While examining the trading details of the employees in both the cash and derivatives segment for the period between April 1, 2018, and March 31, 2019, Sebi observed that the transactions aggregated to a traded value exceeding ₹10 lakh in a calendar year.
Last October, Sebi wrote to Titan whether the company or its compliance department had received any disclosures from these employees for the trades done, said the person in the know. The company told the regulator that no disclosures were received.
In response to ET’s query, a Titan spokesperson said, “The company had provided all the information sought by Sebi. This is a matter concerned between Sebi and respective individuals and we do not wish to comment further.” An email sent to Sebi remained unanswered till press time.
“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,” said Sumit Agrawal, partner, Regstreet Law Advisors.
“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,” he said.