Sebi had begun investigating Brightcom Group following complaints received between October 2020 and March 2021 alleging misstatements and irregularities in the company’s accounts. The probe focused on a six-year period and examined possible violations.
Following the investigation, a show-cause notice was issued in September 2024 to multiple individuals, including compliance officer M Manohar and independent director M Vijaya Bhasker Reddy. Sebi alleged that Manohar failed to disclose the initiation of a forensic audit and did not ensure accurate shareholding disclosures during his tenure. Reddy, as a member of the company’s audit committee, was accused of failing to ensure that financial statements complied with accounting standards and presented a true and fair view of the firm’s affairs.
Both applicants filed for settlement while the proceedings were pending. After meetings with Sebi’s internal committee and recommendations from the high powered advisory committee, the regulator approved the terms.
Under the settlement terms, each applicant will pay Rs 12.35 lakh. Manohar has also agreed not to associate with Brightcom Group or its subsidiaries for one year, while Reddy faces a two-year bar. Sebi confirmed that the penalties have been paid in full.
Sebi has disposed of the proceedings initiated through the 2024 show-cause notice. However, the order states that the regulator may reopen enforcement action if any misrepresentation or breach of settlement conditions is later discovered. The settlement order comes into immediate effect.
