Infy slaps fine on board member for breaching code

BANGALORE: IT Bellwether Infosys Technologies has slapped a fine of Rs 5 lakh on Srinath Batni, director of the company, for breaking the company's code of conduct.

The company, in its statement to United States Securities and Exchange Commission, said that, on August 14, 2006, Batni, an executive director of the company, sold 10,000 equity shares of the company.

Pursuant to the terms of the company's Insider Trading Rules, a director, officer or certain other designated employees of the company may buy or sell the company's equity shares only after prior notification to the company, may only buy or sell such equity shares during an open trading window, and must notify the company within one working day following the execution of such transaction.

“Batni notified the company of his intent to sell his equity shares and sold such equity shares during an open trading window. However, Batni inadvertently failed to notify the company about the sale of the equity shares within one working day after the transaction, which failure was a violation of the company's Insider Trading Rules. Batni notified the company of his sale of 10,000 equity shares on August 23, 2006,” the Nasdaq-listed Infosys said.

Further, the audit committee of the Infosys's board of directors, which is responsible for review of company management's monitoring of compliance with the company's standards of business conduct, determined that Batni's failure to timely notify the company of the sale of equity shares was a technical violation of the Insider Trading Rules, which forms a part of the company's Code of Conduct, and therefore imposed on Batni a penalty of Rs.500,000, which Batni has been directed to pay to a charity, said Infosys statement.

Batni was inducted as a member of the Board of Directors in May 2000. He has served as senior vice president and Head - Retail and Telecommunications Business Unit of Infosys since 1996.

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