REGULATORY · COMPETITIVE · INDIA
Fino Payments Bank leadership disruption after CEO arrest in GST probe
Change
Fino Payments Bank MD & CEO Rishi Gupta was arrested by the DGGI under CGST/SGST Act provisions in a probe tied to the bank’s business partner(s), and the board appointed CFO Ketan Merchant as interim head.
Why it matters
DGGI (GST’s investigation wing) arrested Fino Payments Bank MD & CEO Rishi Gupta under Section 132(1)(a) and 132(1)(i) of the CGST/SGST Act, 2017, after officials visited the head office on Feb. 26 to question senior management about business partners. The bank stated the investigation relates to business partner(s) and not to the bank’s GST compliance, while sources cited alleged fake invoices causing GST loss. The board convened a special meeting and appointed CFO Ketan Merchant to oversee day-to-day operations as interim head until the board resolves leadership or Gupta resumes office. The bank said it is cooperating with authorities and that the estimated amount involved is still being gauged. The event elevates operational, governance, and counterparty scrutiny for a listed, regulated financial institution during the interim leadership period.
Implications
- • Interim leadership installed, shifting decision authority and governance processes.
- • Regulatory/legal exposure expands via partner-linked GST criminal investigation.
- • Heightened disclosure and counterparty scrutiny while amount involved is undetermined.
- • Potential operational distraction from management time spent on investigation responses.
Who is affected
- • Fino Payments Bank board and senior management
- • Fino Payments Bank shareholders and market counterparties
- • Fino Payments Bank business partners referenced in the GST probe
- • DGGI/GST authorities overseeing the investigation
Source
Topics
Law & Public Safety Regulatory Actions Compliance Finance & Banking Financial Services