The Securities and Exchange Board of India (SEBI), has asked Tata Motors Ltd to conduct an internal probe into the alleged leakage of the financial earnings on the WhatsApp message platform ahead of the reports being disclosed to the shareholders and stock exchanges, reports from PTI.
The market regulator has ordered Tata Motors to complete the inquiry within three months and file a report to SEBI within seven days after that. SEBI said it found that the company's October- December quarters financial results of 2015 were matching with the figures that were in circulation before the official announcement.
Tata Motors will be the third company in a row where the regulator has passed an order in the high-profile case of leakage of crucial finance details before the formal announcement of the quarterly results. Earlier, the watchdog had passed similar orders related to Axis Bank and HDFC Bank in the leakage case.
Tata Motors said that it is entirely committed to ensuring confidentiality of such price sensitive information.
"This lapse pertains to an incident in 2015. While the company has robust policies and processes to manage such price sensitive information, we will investigate this lapse thoroughly to identify and address process gaps and fix accountability," the automaker added.
The order stated, "It is observed that the financial figures about the quarterly results of Tata Motors were matching with the figures that were in circulation before its official announcement by the company."
"Such resemblance of the information circulated on WhatsApp with the actual financial results prima facie indicates that the financial figures of Tata Motors, were in circulation before official announcement/ publication by Tata Motors," it added.
"Such leakage is prima facie attributable to the inadequacy of the processes / controls / systems that Tata Motors as a listed company had put in place," the regulator noted.
Sebi has asked Tata Motors to "strengthen its processes/ systems/ controls forthwith to ensure that such instances of leakage of unpublished price sensitive information (UPSI) do not recur in future".
It has also asked the automaker to conduct an internal inquiry into leakage of unpublished price sensitive data relating to its financial results and take appropriate action against those responsible, by law.
Sebi further said the inquiry should include determination of the possible role of persons about leakage of UPSI including persons involved in the consolidation of the figures for the financial results.
Besides, the probe will also cover the persons involved in the consolidation of figures for the fiscal results, as even those involved in the preparation of board notes and presentations and disclosure of information relating to financial results in the public domain. It also included any other persons who had access to the report.