India's Polaris Financial slumps after regulator bars CEO from trading

MUMBAI, Oct 10 (Reuters) - Shares of India's PolarisFinancial Technology Ltd slumped on Wednesday afterthe country's market regulator accused the software servicesfirm's chief executive of insider trading and barred him fromparticipating in the securities markets for two years.

The Securities and Exchange Board of India (SEBI) said lateon Tuesday it has barred Polaris CEO Arun Jain from buying,selling or dealing in securities either directly or indirectly.

Jain denied the accusation of insider trading when contactedby Reuters and said he would appeal against the regulator'sorder with the Securities Tribunal.

In its report, SEBI accused Polaris, formerly called PolarisSoftware Lab Ltd, of "deliberately" withholding in September2000 a price-sensitive decision to call off a plannedacquisition of U.S. software solutions and services providerData Inc.

SEBI further accused Jain of selling shares in Polaristhrough a separate company he controlled after the decision hadbeen made but before the announcement was disclosed to theexchanges.

Polaris shares were down 7.1 percent as of 0446 GMT afterearlier falling as much 8.6 percent. The broader marketwas down 0.46 percent.

(Reporting by Rafael Nam and Harichandan Arakali; Editing byMuralikumar Anantharaman)


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