PayTM's Vijay Shekhar Sharma, Other Directors Face Notice By Sebi, Company Clarifies: Report
The notice pertains to Sharma’s classification as a promoter, which SEBI claims violated regulatory norms
As per media reports, One97 Communications, the parent company of Paytm, clarified on Monday that it has not received any new notice from the Securities and Exchange Board of India (SEBI). The company noted that this issue was already disclosed in its latest annual financial results.
According to media reports, Paytm stated that it has provided a preliminary response and is in regular communication with SEBI, making necessary representations on the matter. The company also highlighted that relevant disclosures about SEBI’s notice were made in its financial results for both the quarter and year ending March 31, 2024, as well as for the quarter ending June 30, 2024, as per media reports.
The Securities and Exchange Board of India (SEBI) has issued show-cause notices to Paytm’s founder Vijay Shekhar Sharma and board members regarding alleged misrepresentation during the company’s November 2021 initial public offering (IPO), as per media reports. The notice pertains to Sharma’s classification as a promoter, which SEBI claims violated regulatory norms.
As per media reports, the Reserve Bank of India’s (RBI) probe into Paytm Payments Bank triggered the inquiry. The issue revolves around whether Sharma, who held management control during the IPO, should have been classified as a promoter instead of an employee. SEBI norms prohibit promoters from receiving employee stock options (ESOPs) after a company’s listing.
Additionally, according to media reports, SEBI is holding Paytm’s board members accountable for failing to verify the accuracy of Sharma’s claims during the IPO filing.
