LIC, India's premier life insurance corporation, has taken stern action against an employee found engaging in unethical trading practices. The individual in question reportedly traded using their deceased father's demat account, leading to their dismissal from the company.
Market regulator SEBI confirmed the involvement of an LIC employee in front-running trades of a significant client, triggering investigations into the matter. LIC responded by asserting that they have implemented stringent measures to ensure transactional integrity within their dealing room.
In a statement, LIC emphasized their commitment to upholding ethical standards, stating, "We have further placed robust controlling mechanisms along with best practices to prevent any kind of front running." The corporation reiterated its zero-tolerance policy towards such misconduct, affirming that appropriate disciplinary action had been taken against the employee.
SEBI, in its investigation, found prima facie evidence indicating the employee's involvement in fraudulent trading activities, leading to the issuance of an interim order. The regulator highlighted the seriousness of the matter, stating that detailed investigations are ongoing.
The investigation, initiated by SEBI following surveillance alerts, spans the period between January 2022 and March 2022. Additionally, trades conducted between January 1, 2020, and March 15, 2022, are under scrutiny, reflecting the thoroughness of the regulatory inquiry.
This incident underscores the importance of maintaining ethical conduct in financial institutions and the vigilant oversight exercised by regulatory authorities to uphold market integrity. LIC's decisive action serves as a reminder of the consequences of breaching trust and ethical standards within the financial sector, reinforcing the imperative for transparency and accountability in all dealings.