Stocks

Polaris chief Arun Jain barred from market for 2 years

| Updated on: Oct 09, 2012
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SEBI has prohibited Arun Jain, Chairman and Managing Director, Polaris Software Lab, from transacting in securities for two years. This is for violating insider trading regulations. SEBI found that Polaris Holding Private Limited (PHPL), a promoter group company, had sold 15,080 shares of Polaris Software between August 23, 2000 and September 19, 2000 through Chennai-based broker Allsec Securities.

SEBI found that Jain had, at the time, been privy to unpublished price-sensitive information that Polaris Software had called off its proposed acquisition of a US-based company, Data Inc. Though the acquisition was called off at end August, the information was not given to the bourses until September 30, 2000. SEBI found that the trading (in 15,080 shares) was motivated on the basis of the price-sensitive information in Jain’s possession, and he was not able to prove otherwise.

After the information was made public, the share price of Polaris Software, which had closed at Rs 595 on September 29, fell to Rs 390 on October 23, 2000. This case was settled through the consent mechanism (without admission or denial of guilt and on payment of consent charges of Rs 7 lakh) on July 21, 2008.

However, SEBI had, in 2005, considered proceeding against Jain under Sections 11 and 11B of the SEBI Act (that empowers the regulator to issue directions in the interest of investors). The order comes into effect immediately.

>raghavendrarao.k@thehindu.co.in

Published on November 17, 2017

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