IndusInd Bank’s Trading Scandal: Execs Under Scrutiny for Accounting Lapses

A recent investigation by Grant Thornton, an audit and advisory firm, has revealed serious issues at IndusInd Bank in India. Two top executives, CEO Sumant Kathpalia and Deputy CEO Arun Khurana, traded shares of their own bank while knowing about accounting mistakes that hadn’t been shared with the public yet.

In March, IndusInd Bank admitted that they had mismanaged internal trades, resulting in $230 million missing from their balance sheet. Following this discovery, both Kathpalia and Khurana resigned—Kathpalia taking moral responsibility and Khurana referring to unfortunate events.

The investigation highlighted that there were signs suggesting Kathpalia and Khurana made trades during a time they should have kept quiet. It also mentioned the possibility of insider trading, which is illegal. Despite multiple attempts to get comments from Kathpalia, Khurana, the bank, and Grant Thornton, nobody responded.

Between March 2024 and when the bank admitted the mistake in March 2025, Kathpalia sold shares worth around $3.3 million and bought others, while Khurana sold shares valued at about $3.9 million. The report found that many bank employees were aware of the accounting problems, and issues had been flagged as early as May 2015. Some employees even suggested to delete important emails and not share information about the accounting mistakes.

Due to these problems—like outdated accounting methods and poor documentation—the bank’s shares fell after the disclosure, but are expected to recover as the central bank reassured the public that IndusInd Bank remains stable and well-capitalized.