Synopsis : Former IndusInd Bank CEO Sumant Kathpalia has proposed a ?5.21 crore settlement to SEBI in an insider trading case linked to confidential RBI communications. The offer comes after SEBI barred five senior executives from the market and impounded nearly ?20 crore.:
In a significant development, Sumant Kathpalia, the former CEO of IndusInd Bank, has proposed a settlement of ?5.21 crore to the Securities and Exchange Board of India (SEBI) in connection with an insider trading case, as reported by The Economic Times. The case revolves around the alleged misuse of confidential directives issued by the Reserve Bank of India (RBI).
SEBI’s settlement framework allows alleged violators to resolve investigations by paying a settlement fee, without admitting or denying guilt. Kathpalia’s offer is now under regulatory review.
Earlier in May, SEBI had passed an interim order barring five senior IndusInd Bank executives, including Kathpalia, from trading in the securities markets. The other officials named were Arun Khurana, Sushant Sourav, Rohan Jathanna, and Anil Marco Rao. The regulator also impounded ?19.78 crore from the group, citing evidence that they traded on non-public information gained from internal assessments of a crucial RBI circular.
SEBI’s order stated that the executives were “restrained from buying, selling or dealing in securities, either directly or indirectly, in any manner whatsoever, until further orders.”
The scandal has come at a turbulent time for IndusInd Bank, which recently reported a 68% drop in Q1FY26 profits to ?684 crore, driven by rising provisions and deteriorating asset quality. Earlier discrepancies in the derivatives portfolio — amounting to ?1,580 crore — had already rocked investor confidence. The situation worsened following Kathpalia’s resignation on April 29 and the premature exit of other top executives.
As scrutiny continues, the settlement proposal may offer temporary closure for Kathpalia, but questions remain about corporate governance and internal controls at one of India’s prominent private sector lenders.
Disclaimer : This article is based on publicly available information and media reports. It is intended solely for informational purposes and does not constitute legal, financial, or investment advice.
