While banning Gupta from serving as an officer or director of a public company, the SEC asked him to pay $13.9 million penalty
The US Securities and Exchange Commission (SEC) has ordered Rajat Gupta, former group director of Goldman Sachs to pay a $13.9 million civil penalty and banned from serving as an officer or director of a public company for having illegally passed corporate secrets to former hedge fund manager Raj Rajaratnam.
Gupta, 64, is appealing his June 2012 conviction and two-year prison term for having provided confidential tips he learned at Goldman board meetings during the second half of 2008 to Rajaratnam, a former billionaire who ran Galleon Group.
The tips included news about Goldman's financial results and a crucial USD 5 billion investment during the financial crisis by Warren Buffett's Berkshire Hathaway Inc.
"The sanctions imposed today send a clear message to board members who are entrusted with protecting the confidences of the companies they serve," George Canellos, co-director of the SEC's enforcement division, said in a statement.
Rajaratnam, serving an 11-year prison term, was the highest-ranking financial executive convicted in a multi-year federal crackdown on insider trading. Gupta is the highest-ranking corporate executive convicted in that probe.
Gupta is a former global managing director of the consulting from McKinsey & Co. He remains free during his appeal.
SEBI is being given more powers to regulate fraudulent activities and ponzi schemes that collect money from gullible people by giving false information
The Government has decided to come out with an ordinance to provide more powers to market regulator Securities and Exchange Board of India (SEBI) for tackling fraudulent investment activities and ponzi schemes that defraud investors.
Speaking with media, Sachin Pilot, minister for corporate affairs said, "The smallest of the investors need the most of our protection and I believe that the ponzi schemes, these chit funds that are in operation illegally, need to be put (under regulation). I think few of the amendments proposed are to be put as ordinance."
On Wednesday, the union cabinet approved the proposal to amend the SEBI Act and other relevant regulations that would give greater powers to the regulator in its efforts to tackle all kinds of money-collection schemes, as also to effectively crackdown on defaulters in the stock markets.
"SEBI is being given the authority to do much more now and take effective and quick action against non-compliant companies. The Cabinet has approved it and the Ministry of Corporate Affairs is fully supporting the efforts of SEBI," Pilot said.
Emphasising that companies raising money illegally should be prohibited, the union minister said it is important for SEBI to have enforcing ability to make sure that these companies are put an end to.
In recent times, there have been many instances such as the scam perpetrated by the Kolkata-based Saradha group that allegedly defrauded money from the public.
Besides, SEBI is expected to have powers to seek information, such as telephone call data records, from any persons or entities in respect to any securities transaction being probed by it.
Poor revenues on account of lower volumes, discount on trucks, higher fixed costs and increasing finance costs negatively impacted the bottom line of the company.
After disappointing Q4FY13 results Ashok Leyland reports a net loss of Rs141.75 crore in Q1FY14. This was the first time since its first quarter results of FY2001-02 that the company recorded a net loss over a quarter. The company had posted a net loss of Rs9.40 crore in the first quarter of FY2001-02. Operating profit too, slid to its lowest since that reported in the June 2009 quarter. The operating profit of India’s No.2 truck-maker fell by 90% y-o-y to Rs23.25 crore from Rs240.70 crore in the same period last year.
In the first quarter of this fiscal year, the company recorded a 22% y-o-y (year-on-year) decline in revenues. Revenues fell to Rs2,363.81 crore from Rs3,026.89 crore reported for the same quarter last year. Lower contribution of M&HCVs and historically high discount of approximately Rs159,000 per vehicle affected revenues drastically. “Industry conditions remain tough, which is leading to higher discounts and impacting profitability,” mentions research firm Nomura.
According to other research reports, the weak economy affected the high margin medium & heavy commercial vehicles (M&HCV) segment which reported a decline of 27% y-o-y. Volumes declined by 37.30% qoq to to 21,721 units from 34,627 units in Q4FY13. Over the year, volumes declined by 21.50% y-o-y from 27,669 units in Q1FY13. The slowdown has even impacted the light commercial vehicle segment which declined by 6% y-o-y. Finance costs increased by 21% y-o-y to Rs100.67 crore due to higher working capital related to high inventory during the quarter.
According to a research report from Karvy Stock Broking, “exports declined 22.3% y-o-y to 2,334 units, primarily on account of ~74% Y-o-y fall in its exports to Sri Lanka to 340 units in Q1FY14, while management indicated improvement in other geographies of Middle‐East & Africa.” The broking firm also mentions that “In addition to ongoing M&HCV slowdown and LCVs begun declining, Ashok Leyland also started losing market‐share in both the segments, which will result in lower volume, going forward.”
Ashok Leyland also announced capex and investment to the tune of Rs200 crore each for FY14E, which would lower its interest burden, going forward. The company has hiked prices by approximately Rs 20,000 per vehicle at the beginning of July’13, which should benefit the company going forward.