The Securities and Exchange Board of India (SEBI) has accused current and former executives at the local units of PwC and EY, among others, of breaching insider trading rules involving a 2022 share sale by Yes Bank, according to a regulatory notice.
SEBI also accused executives at U.S. private equity firms Carlyle Group and Advent International of sharing unpublished price sensitive information related to the deal, in violation of insider trading rules, according to the notice reviewed by Reuters.
Advent, Carlyle, EY, PwC, Yes Bank and SEBI did not respond to requests for comment.
Issued in November, the notice, which has not been reported previously and is not public, alleges two executives at PwC and EY and five other family members and friends made unlawful gains by trading in shares of Yes Bank ahead of its 2022 share offering.
Most of the accused individuals are still serving at their respective firms.
Unpublished price-sensitive information was shared: SEBI
SEBI’s notice showed that Indian executives of Carlyle, Advent, PwC, and EY shared unpublished price-sensitive information, enabling others to trade on the information. It also accused a former Yes Bank board member of sharing price-sensitive information enabling others to trade.
The notice from the regulator followed an investigation into movements in Yes Bank’s shares ahead of a July 2022 share offering, in which Carlyle and Advent bought a combined 10% stake for $1.1 billion.
The shares of the bank opened 6% higher a day after the deal was announced on July 29, 2022.
Response to notice being drafted
The accused individuals, along with their companies, are in the process of drafting their responses to SEBI’s notice, according to two people familiar with the investigation, who declined to be named due to sensitivity of the matter.
A show cause notice is SEBI’s first step after a probe is completed, and is meant to seek responses from accused persons and entities. If upheld, they could face monetary penalties or restrictions under Indian securities regulations.
Rare instance
The regulatory action marks a rare instance in which senior executives at global consultants and private equity firms have been accused of insider trading violations linked to a capital raising deal.
The action also comes against the backdrop of a sharp surge in capital raising by Indian companies, drawing global investors looking to diversify away from the U.S. due to heightened geopolitical tensions.
The regulator has ramped up a crackdown on market manipulation and insider trading over the last few years. In another recent case, SEBI has alleged breaches of insider trading rules by Bank of America’s India unit during a fundraising process.
Trading on unpublished information
The notice accuses a total of 19 individuals of insider trading rule breaches. Seven of them traded based on privileged information and four shared those information. It named eight PwC and EY executives for weak compliance processes.
Ahead of the share offer, Advent hired EY for tax advisory services and sought feedback from the firm on Yes Bank’s management. Separately, EY Merchant Banking Services was engaged by Yes Bank to conduct valuation work.
Around the same time, PwC was hired by Carlyle and Advent for tax planning and due diligence. SEBI found that executives at both EY and PwC breached confidentiality norms, allowing some individuals to trade Yes Bank shares ahead of the capital raise.
According to the notice, EY failed to place Yes Bank on a sufficiently broad “restricted list”, a list of listed companies that executives at a firm are not allowed to trade in.
While staff directly involved in the transaction were barred from trading, others were not, despite having potential access to sensitive information, the notice said.
SEBI said in its notice that this violated a requirement that anyone with access to unpublished price sensitive information must obtain pre-clearance before trading.
SEBI has asked Rajiv Memani, EY India’s chairman and CEO, and the firm’s chief operating officer to explain why penalties should not be imposed, arguing that EY’s internal trading policy did not comply with regulations.
“No restriction was ever imposed on trading or investing in listed companies with which EY was engaged for advisory, consulting, valuation, investment banking or corporate finance services (other than audit),” SEBI said.
In PwC’s case, SEBI said the firm did not have a “restricted stock list” for advisory and consulting clients.
The notice alleged that PwC’s internal protocols required disclosures by a staffer when they bought company shares for the first time and when they sold them, a practice that SEBI said allowed subsequent trades to go unreported in the Yes Bank case.
PwC’s Chief Industries Officer in India Arnab Basu and two former executives have also been asked by the regulator to respond for failing to implement an adequate code-of-conduct framework at the firm.
Both Mr. Memani and Mr. Basu, who have not been accused of any wrongdoing by the regulator, did not respond to requests for comment sent to their company spokespersons.
Published – January 23, 2026 02:40 pm IST
