Sebi issues show-cause notice to founder Vijay Shekhar Sharma? Here's what Paytm says

Hours after reports of a show-cause notice from Sebi to Paytm founder Vijay Shekhar Sharma and board members, the company has clarified that this is neither a new notice nor a new development. It added that as part of its stock exchange filing, it had made relevant disclosures relating to Sebi's notice in its financial results for the quarter and year ended March 31, 2024, as well as the quarter ended June 30, 2024. 

Earlier, it was reported Sebi issued notice to Sharma and other board members who served during its initial public offering in November 2021 for alleged misrepresentation of facts. Shares of One97 Communications Ltd., the parent company of payments aggregator Paytm, fell over 4 per cent on Monday after the news and closed at Rs 530 on NSE.

Media Advisory: In response to recent media reports regarding the SEBI notice, we want to clarify that this is neither a new notice nor a new development. We had already disclosed this matter in our financial results for the quarter and year ending March 31, 2024, as well as…

— Paytm (@Paytm) August 26, 2024

The company received a SEBI notice during the quarter ending March 2024 and has already addressed the matter by making a preliminary response. Paytm said it is currently in the process of seeking further information from SEBI regarding this matter.

The reported notices from the market regulator pertain to Sharma’s alleged non-compliance with promoter classification norms. The outlet stated that the probe was initiated based on inputs from RBI. In January this year, the central bank issued a directive to prohibit Paytm Payments Bank Limited (PPBL) from accepting deposits or top-ups in any customer account, effective from February 29 onwards.

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