Indian Technology Team Infosys rocked by whistleblower claims
Indian Technology Team Infosys rocked by whistleblower claims against CEO Salil Parekh.
Allegations of misconduct at one of India’s biggest technology companies have sent its stock plunging.
Infosys (INFY) shares dropped more than 16 percent in Mumbai on Tuesday after the company said it was exploring two whistleblower complaints detailing alleged unethical practices.
A member of Infosys’ board received the complaints on September 30, chairman Nandan Nilekani said in an announcement. The first complaint includes allegations of”bothering unethical practices” while the next” primarily deals with accusations regarding the CEO’s international travel,” he said. The company first revealed the complaints on Monday.
The company is also aware of a letter written to US authorities under a whistleblower protection program, which refers to emails and voice records supporting the allegations, Nilekani said.
“Although we haven’t been given any of the emails or voice recordings, we’ll make certain that the generalized allegations are investigated to the fullest extent,” he added.
The complaints accuse the company’s CEO of under-reporting prices to be able to inflate profits and concealing”critical information” from auditors and the board, based on numerous Indian papers, which stated they’d obtained copies of the alleged complaints. CNN Business hasn’t seen or independently verified the charges, and an Infosys spokesperson declined to comment on the allegations past Nilekani’s statement.
The CEO, Salil Parekh, and CFO, Nilanjan Roy, have been recused from the matter, Nilekani said. The analysis will be conducted by Shardul Amarchand Mangaldas & Co.. , a prominent Indian law firm.
“These complaints are being handled accurately,” Nilekani said.
CNN Business has tried to get Parekh and Roy directly. The Infosys spokesperson said executive planned to comment at this time.
Infosys, headquartered in Bangalore, is one of India’s biggest outsourcing firms. It reported earnings of $11.8 billion in the past fiscal year and has almost 230,000 employees globally, including tens of thousands in America.
This isn’t the first time the company has been hit by controversy over its own finances. Parekh’s predecessor, Vishal Sikka, resigned in 2017 following a public spat with a number of its creators over executive pay and other problems.