New Delhi: Software services firm Infosys Technologies has imposed penalty on S Gopalakrishnan, its chief executive officer, and Jeffrey Sean Lehman, an independent director, for violating company rules.
The Audit Committee of Infosys Technologies’ board of directors has imposed a penalty of Rs5 lakh on Gopalakrishnan and a fine of $2,000 on Lehman as they had failed to comply with the insider trading norms of the company, Infosys said in a notice to the US Securities and Exchange Commission (USSEC).
According to the Insider Trading Rules, a director, officer or other designated employees of the firm may buy or sell its securities only after prior notification and must notify within one business day following any change in his or her shareholding, it added.
The process requires the employee to apply to the firm’s compliance officer for pre-clearance of each of such transaction and provide certain information and undertakings to the company through its compliance officer.
On 24 December, 2007, Gopalakrishnan, inherited 12,800 equity shares from his mother. However, he failed to notify the company within one business day following the change in his shareholding, which led to the imposition of the Rs5 lakh penalty.
Gopalakrishnan was directed to donate the amount to a charitable organisation of his choice and he has made the donation as directed by the company’s audit committee.
On 7 December, 2007, Jeffrey Sean Lehman, had sold 900 American Depositary Shares (ADSs) of the company. Though, Lehman notified the company of his intent to sell his ADSs, and also informed within one business day about the execution of the transaction, he failed to seek approval of the company’s compliance officer and requisite information in advance of such sale, which were violation of the firm’s Insider Trading Rules, Infosys said.
Accordingly, the audit committee of the company’s board of directors, on 2 January, this year imposed a penalty of $2,000, upon Lehman and he was directed to donate it to a charitable organisation of his choice. Lehman has made the donation as directed by the company’s audit committee.