Bank of America launches probe following whistleblower alleging disclosure of confidential information: Report

Bank of America launched an internal investigation following a whistleblower complaint filed in June, which accused bankers of disclosing confidential information to investors before important stock sales in Asia, as reported by The Wall Street Journal.
The complaint, reviewed by The Wall Street Journal, specifically alleged that bankers shared details of a transaction with investors before the announcement of a stock sale in India, potentially allowing the investors to engage in "front-running," an illegal practice involving trading based on privileged information before it is made available to clients.
According to the WSJ report, company records revealed that investment bankers held meetings with investors such as Jane Street, Norges Bank, and HDFC Life prior to the $200 million public sale of stock for Aditya Birla Sun Life AMC. The stake sale was announced on March 18 and executed around March 20.
On March 18, the promoters of the fund house, Aditya Birla Capital and Sun Life (India) AMC Investments, approved the sale of 2.01 crore shares, representing a 7 percent equity stake in the company. The stake sale also included an oversubscription option to offload an additional 1.28 crore shares, amounting to a 4.47 percent equity. Through this option, the promoters aimed to sell a total of 11.47 percent equity in the AMC company.
However, Bank of America has denied the allegations, as reported by Reuters. A spokesperson from the bank said, "We take complaints seriously and thoroughly investigate them. In instances where we conclude there has been inappropriate behaviour, we take disciplinary action."
The report stated that the complaint was submitted to the Securities and Exchange Board of India (Sebi) and the head of investment banking for Bank of America in Asia in June.
Investment bankers contacted investors through WhatsApp to share transaction details before the stake sale was announced in India, as per the report.