The regulator, SEBI, on Wednesday, in its first order in the WhatsApp leak case had ordered Axis Bank to toughen its systems and conduct an internal probe to fix responsibility as the preliminary investigation showed the leakage happened due to inadequacy of processes at the bank.
The regulator further stated that Axis Bank should complete the inquiry within three months and then send a report to them within seven days. The regulator prior to an official announcement further found that the company’s results for the April–June 2017 quarter were either equal or matched closely with the figures that were in circulation on WhatsApp.
SEBI began an investigation last month ahead of their official announcements after a media report found the circulation of Unpublished Price Sensitive Information or UPSI in various private WhatsApp groups about some companies, which included Axis Bank. The regulator also directed search and seizure operations in this regard at various places that included the premises of various market entities.
SEBI further stated that the inquiry should establish the possible role of persons in relation to the leakage of UPSI, including those involved in generation of the original data for the determination of key figures related to GNPA, NNPA, NIM, slippage, write-off, CASA, etc. Besides, the inquiry should also cover the persons involved in the consolidation of the figures for the financial results. SEBI further told the bank that the inquiry should also cover role of any other persons who had access to the information.
SEBI then sought information from the Axis bank and asked it to submit data regarding how they handled the UPSI processes and controls. In response, the bank submitted that it safeguarded adherence to the applicable laws and adopted adequate processes and controls to maintain privacy of price sensitive information relating to the bank.