The senior executives at One97 Communications, the company behind Paytm, have submitted fines to the Securities and Exchange Board of India (Sebi) to resolve accusations of breaching regulations. The allegations relate to providing advantages to Vijay Shekhar Sharma, CEO of Paytm, and his family members, as well as approving and signing public offering documents that contained inaccurate information and incomplete disclosures about the promoting entity.
The settlement order was issued by Sebi on January 17. The settlement amount proposed by SEBI’s advisory committee was subsequently approved by the whole-time members panel.
Former compliance officer Amit Khera and several former members of the board, including independent directors Ashit Ranjit Lilani, Neeraj Arora, Mark Schwartz, and Pallavi Shardul Shroff, as well as former directors Douglas Feagin, Munish Varma, and Ravi Chandra Adusumalli, collectively settled allegations of violations against Listing Regulations and Public Issue Regulations of the market regulator by paying over Rs 3.32 crore.
The regulator’s six-page order stated that Khera did not ensure compliance with the regulatory provisions applicable to the listed entity as per the LODR Regulations, 2015. Additionally, independent directors Lilani and Arora, who are part of the NRC, did not fulfill their duties impartially and independently when making decisions related to benefits for the company’s MD & CEO Vijay Shekhar Sharma and his relatives, as outlined in the order.
The market regulator issued a show-cause notice in May 2024, accusing the NRC of neglecting their duties in an impartial and independent manner. Furthermore, the former board members were alleged to have endorsed and executed offer documents containing inaccurate statements and inadequate disclosures.
The offer documents were approved and signed by the directors, despite containing incorrect statements and incomplete disclosures, as observed. Subsequently, their applications were presented to the Internal Committee of Sebi during its meeting on August 27, 2024.