Bank of America’s Indian investment banking arm has reached a settlement with market regulator SEBI to resolve accusations of insider trading and merchant banking rule violations. The Securities and Exchange Board of India issued a settlement order, which BofA Securities India accepted by paying ₹58.5 lakh to resolve the matter without admitting or denying the findings.
The case involves a March 2024 block trade which Aditya Birla Sun Life Asset Management executed, but the regulator claimed that they failed to properly handle confidential market information. SEBI stated that the company did not create a complete Structured Digital Database system, which serves as a required compliance tool for insider trading rules that need to record all secret information movement. The regulator accused the company of violating internal “Chinese wall” procedures when deal team members who had confidential information about the transaction approached potential investors.
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The order said that the firm withheld essential information while providing false information during the inquiry, which started because of a whistleblower report. The settlement ends the current legal proceedings, but SEBI reserved the right to launch new legal actions if it discovers that the company failed to disclose complete information during the proceedings. The development comes as Indian regulators continue tightening oversight of insider trading practices and compliance standards across financial institutions.
