New Delhi, Aug 31 (PTI) Markets regulator Sebi on Monday penalised one person for releasing unpublished price sensitive information (UPSI) related to financial results of HDFC Bank through WhatsApp messages prior to the official announcement by the company.

The regulator levied a fine of Rs 15 lakh on Renish Hareshbhai Bhuva, a Sebi order said.

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Some news reports had referred to the circulation of UPSI in various private WhatsApp groups about certain companies ahead of their official announcements to stock exchanges.

Against this backdrop, Sebi had initiated a preliminary examination in the matter during which search and seizure operation for 26 entities for WhatsApp groups were conducted, and about 190 devices, records, among others, were seized.

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WhatsApp chats extracted from the seized devices were examined further and while examining the chats, it was found that earnings data and other financial information of around 12 companies were leaked through WhatsApp messages.

HDFC Bank was one of the firms whose quarterly financial results were leaked.

Accordingly, the regulator carried out an investigation in the matter of circulation of UPSI through WhatsApp messages with respect to HDFC Bank to ascertain any possible violation of the PIT (Prohibition of Insider Trading) Regulations during January 1, 2016 to January 25, 2016 period.

Sebi noted that the preparation of draft preliminary financial statements for quarter ended December 2015 started from January 1, 2016. The corporate announcement of audited financial results of HDFC Bank for the quarter was made to the exchanges (BSE and NSE) on January 25, 2016.

Therefore, the period of UPSI was January 1, 2016 to January 25, 2016.

Renish was an insider and had possession of the UPSI relating to the financial results.

The messages pertaining to the financial results, circulated prior to the official announcement made by the HDFC Bank, is UPSI and was circulated by him, in contravention of market norms, Sebi noted.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)