Wockhardt Former executive banned from securities market for six months for insider trading
New Delhi: Sebi has barred Yatendra Kumar, a former executive of Wockhardt Ltd, from the securities market for six months and directed him to disgorge losses of over Rs 14 lakh averted by flouting insider trading rules.
In addition, he has been restrained from buying, selling or dealing in the securities of Wockhardt Ltd for one year.
The Securities and Exchange Board of India (Sebi) conducted an investigation in the matter of trading in the scrip of Wockhardt for the period from January 2012 to August 2013 to ascertain any violation of the provisions of insider trading rules.
In its 50-page order on Monday, Sebi found that Kumar traded in the company's shares when in possession of unpublished price-sensitive information (UPSI) regarding issuance of Form 483 by the US Food and Drug Administration (USFDA) to Wockhardt's manufacturing facility at Waluj in Maharashtra.
Form 483 contains FDA's observation in detail and is issued if USFDA finds objectionable conditions upon completion of inspection of facilities. The issuance of such a form is regarded as adverse observations. Unless rectified, it may ultimately lead to issuance or warning and import alert, which have financial implications for the concerned company.
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