India regulator alleges Bank of America unit breached rules

Securities and Exchange Board of India (SEBI) issued a show-cause notice to Bank of America's India securities unit over a March 2024 share sale, alleging breaches of insider trading norms and merchant banking rules; the bank has filed an application to settle the charges without admitting guilt and that application is under review.

India's markets regulator has sought an explanation from Bank of America's India securities unit, issuing a show-cause notice tied to a March 2024 share sale of Aditya Birla Sun Life Asset Management Company. The matter first emerged after a 2024 whistleblower complaint that prompted an internal bank probe and departures of senior officials. SEBI's notice alleges failures in internal controls and the inappropriate sharing of confidential information; the bank has applied to settle the charges and that application is under review. Key points: - SEBI's notice, dated Oct. 30, alleges BofA Securities India violated insider trading norms and the merchant banking code of conduct in the March 2024 ABSL AMC share sale. - The regulator reported a breakdown of "Chinese walls" between the deals team and the firm's research and broking arms, and said material facts were suppressed and false statements were made during the probe. - The case began after a whistleblower complaint in 2024 and led to an internal probe at the bank and the exit of senior officials. - BofA Securities India has filed an application to settle the charges without admitting guilt; that application is under review and SEBI and the bank have not responded to media queries. Summary: SEBI's allegations represent a formal regulatory action relating to the management of a 2024 share sale and highlight reported weaknesses in internal information controls. The bank's settlement request is currently under review and the regulator's next formal steps were not specified in the notice.