LIC Employee Who Exploited Late Father's Account In Front-Running Scheme Fired

Life Insurance Corporation of India (LIC), the state-run behemoth, announced the termination of Yogesh Garg, an employee entangled in a front-running scandal spotlighted by the Securities and Exchange Board of India (SEBI).

This decision follows SEBI’s imposition of a ban on Garg for his involvement in manipulating stock market trades to his advantage, an incident that surfaced last year.

What Happened: Garg, formerly part of LIC’s equity dealing team and identified as the linchpin in this scheme, reportedly leveraged inside information to execute stock trades that preempted LIC’s own transactions.

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By orchestrating trades through his and his family members’ demat accounts — even extending to his late father’s account — between January and March 2022, Garg managed to secure illicit gains totalling ₹2.44 crore. This strategy involved timing trades to ensure profits by exploiting LIC’s impending market moves.

What to know: In response to the fallout, LIC has ramped up its internal controls, incorporating stringent measures to uphold the integrity of its trading activities. Enhanced security protocols, including biometric access, comprehensive CCTV surveillance, and prohibitions on personal electronic devices, underscore LIC’s commitment to maintaining exemplary corporate governance standards.

SEBI’s recent order reaffirms the initial ban while indicating that the investigation into the matter is ongoing, with findings still under scrutiny.

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