Forensic Review Uncovers Suspicious Share Trades

A forensic review conducted by Grant Thornton has revealed that two executives from IndusInd Bank engaged in share trading activities while being aware of undisclosed accounting discrepancies within the bank. This discovery was made before the bank publicly acknowledged these financial irregularities.

Key Findings: The review highlighted that during a period of non-disclosure, the executives traded shares, raising concerns over potential insider trading. The bank, which is India's fifth-largest private sector bank, had earlier disclosed a $230 million discrepancy in its balance sheet due to years of incorrect accounting of internal derivative trades.

Executives Step Down Amid Controversy

Following the disclosure, CEO Sumant Kathpalia and deputy Arun Khurana resigned from their positions. Kathpalia cited "moral responsibility" in his resignation letter, while Khurana referred to "unfortunate developments" as his reason for stepping down.

Investigation Insights: The summary of Grant Thornton's findings suggested that the timing of the share trades, coupled with the executives' knowledge of the accounting issues, warranted a closer examination from an insider trading perspective. However, neither executive has admitted to any wrongdoing.

No Comments from Involved Parties

Requests for comments from Kathpalia, Khurana, Sebi, IndusInd, and Grant Thornton went unanswered. The document also mentioned another executive's handling of the information regarding the accounting lapses but did not link them to any share trading activities.