The Securities and Exchange Board of India (SEBI) has recently wrapped up its investigation into Spandana Sphoorty Financial Ltd. (SSFL), a non-banking financial company, over alleged breaches of disclosure and listing regulations under its jurisdiction.
The probe centered on infractions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (LODR Regulations). SEBI had flagged violations of Regulation 51(1) and 51(2), which cover the disclosure of financial information and material events, as well as Regulation 51(3), concerning continuous disclosure requirements.
On January 4, 2024, SEBI issued a show-cause notice to SSFL, asking the company to explain why it should not face penalties under Sections 15A(b) and 15HB of the SEBI Act, which address fines for regulatory non-compliance.
In response, SSFL chose to settle the matter rather than contest the charges. The company submitted a settlement application to SEBI, proposing a resolution without admitting or denying the allegations. This application was processed under the SEBI (Settlement Proceedings) Regulations, 2018.
Following this, SEBI’s High Powered Advisory Committee (HPAC) reviewed the settlement proposal and recommended a payment of INR 38,12,160/-. The recommendation was subsequently approved by SEBI’s Panel of Whole Time Members.
The settlement order resolves the adjudication proceedings against SSFL based on the agreed terms. This resolution is made under Section 15JB of the SEBI Act and Regulation 23(1) of the Settlement Regulations, which govern settlement terms and their enforcement.
While this settlement concludes the current investigation, SEBI reserves the right to take further action if it finds that SSFL has not fully adhered to the settlement terms or has breached any related undertakings.
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