Money & Banking

Aditya Birla Capital denies whistle-blower’s allegations

Suresh P. Iyengar | | Updated on: May 16, 2022

The letter bereft of facts; no employee exit as a fallout of malicious allegations

Aditya Birla Capital has stepped in to assuage the impact of unconfirmed reports alleging unethical practice in the organisation by senior officials of the company.

Quoting a whistle-blower’s letter to the top management of the company, a news portal on Monday alleged that the company’s CEO Ajay Srinivasan was eased out of his responsibilities for alleged insider trading and front-running in stocks picked by the Aditya Birla Sun Life Asset Management Company.

The whistle-blower, in a letter sent to the board, had reportedly asked the management to investigate the role of the fund house CEO, A Balasubramanian, and Chief Investment Officer, Mahesh Patil.

Though the allegations are unconfirmed, it rattled investors’ confidence as it comes close on the heels of similar allegations and suspension of two fund managers at Axis Mutual Fund.

However, Aditya Birla Capital denied all the allegations and said the news report was bereft of facts.

Company clarifies

“We received a complaint in which certain allegations were made about Aditya Birla Sun Life AMC and its employees. As per the Aditya Birla Group policy, an independent committee was formed to investigate the allegation. The committee did not find any merit in the allegations. There was no allegation whatsoever made against Ajay Srinivasan by the said employee,” said Aditya Birla Capital in a statement on Monday.

The company also said that Srinivasan expressed his desire to take a new role within the group after having served as CEO for over 14 years. A role is being crafted at the group level in consultation with him, it added. “As planned earlier, Srinivasan has quit as MD and CEO of Aditya Birla Capital and his departure has nothing to do with an investigation into alleged irregularities and corruption by the whistle-blower,” the company said in the statement.

In April, the company had said that Vishakha Mulye, a chartered accountant by qualification and an Executive Director of ICICI Bank, will replace Srinivasan. In her previous role at ICICI Bank, Mulye was in charge of domestic and international wholesale banking, proprietary trading, markets and transaction banking.

‘No employee exits’

There was no employee exit at Aditya Birla Capital and Aditya Birla Sun Life AMC as a fallout of these malicious allegations, it added.

Girish Patil left the company to pursue better prospects outside the group, whereas Vineet Maloo moved internally, in line with the group’s career progression policy. The reference in the article associating his new role with the AMC business is ‘not correct and mischievous’. Further, the reference in the article that Girish Patil and Mahesh Patil are related is absolutely wrong, it said.

Given the competitive nature of the financial services job, many non-performing employees, when asked to leave the organisation, make such allegations and spread false rumours, said a senior official of a recruitment agency.

Meanwhile, shares of both Aditya Birla Capital and Aditya Birla Sun Life AMC tanked five per cent and seven per cent to ₹95 and ₹452 on Monday.

Published on May 16, 2022
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