Infosys: No evidence to back whistleblower allegations

Bengaluru, November 4

Infosys today said it had not yet received any evidence to support the allegations in a whistleblower letter from last month, sending its shares up as much as 6.5% in early trading.

A letter, claimed to have been written by some employees of the company in October, said CEO Salil Parekh asked them and others to bypass approvals for large deals, fearing a negative impact on shares from reduced profit.

Infosys shares have lost 10% of their value since the letter surfaced. The US Securities and Exchange Commission launched a probe into the claims, and its Indian counterpart, the SEBI, asked the company to submit information on the complaints.

“With respect to the anonymous complaints, there is no prima facie evidence that the company has received until date to corroborate any of the allegations made,” Infosys said in a letter dated November 2 to the National Stock Exchange (NSE).

The exchange had asked the company to explain why it had not disclosed the letter. The Bengaluru-based company said since the allegations were not deemed “material”, the company was not obligated to disclose them.

“If the information in the letter is taken on face value without any investigation, then you can do a grave injustice to the accused, who don’t have a chance to defend themselves,” said Ramanujam Sridhar, CEO of Brand-Comm, a communications consultancy based in Bengaluru. — Reuters

THE CASE FILE 

• A letter, claimed to have been written by some employees of the company in October, said CEO Salil Parekh asked them and others to bypass approvals for large deals, fearing a negative impact on shares from reduced profit

• Infosys shares have lost 10% of their value since the letter surfaced. The US Securities and Exchange Commission launched a probe into the claims, and the SEBI asked the company to submit information on the complaints

• The Bengaluru-based company said since the allegations were not deemed “material”, the company was not obligated to disclose them