Indian e-commerce firm Infibeam fires its auditor for alleged data breach — stock tanks as much as 8%

• SRBC & CO, an EY affiliated company, is accused of sharing sensitive data over emails and with third parties by Infibeam Avenues.
• Infibeam has its own problems with its stock opening to an 8% dip on Monday after reports of the data breach came in over the weekend.
• SRBC & CO is "strongly" denying the allegations while Infibeam is citing "breach of trust" and "loss of faith."

A chartered accountancy firm, SRBC & Co — known for being affiliated to Ernst & Young (EY) — is "strongly" denying the allegations of a data breach.

But, Infibeam Avenues — a digital company in India that deals with online transactions and e-commerce — is still terminating its contract with the accounting firm, according to stock market filings seen by the Press Trust of India.


Infibeam — a digital company in India that deal with online transaction and e-commerce — informed the Indian stock exchanges that its auditor SRBC & Co, shared unpublished price sensitive information (UPSI) over emails and with third parties not once, but multiple times.

And, as the stock markets opened Monday morning, its stock price plummeted by almost 8% to ₹40 per share before recovering.

The National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) — two of India’s biggest stock markets — are yet to act on the issue but Infibeam maintains that there has been a breach of trust and loss of faith.



The relationship between Infibeam Avenues and SRBC & Co is dates back to the merger between Avenues India and Infibeam. The accused had raised several alarms over Avenues India’s payment gateway.

For one, ₹240 million of the reported revenue by Infibeam in December 2018 actually belonged in the first and second quarters of the financial year according to the auditors asking Infibeam to clarify its calculation processes.

Even in the market, things haven’t been the smoothest for Infibeam, where its stock prices dipped by 75% in the last financial year.

After SRBC & Co’s termination, accounting firm Shah & Taparia will continue on as auditors for the company.

The public scrutiny has a detrimental effect on SRBC & Co’s reputation as well as EY in light of IL&FS defaulting on its payments to lenders.

EY, along with PwC, Deloitte and KPMG, have been asked to refrain from practicing law until otherwise specified as well as disclose all of their financial details and dealings with IL&FS. In fact, the biggest financial scandal of 2018 may end up costing Deloitte five years of business in India.

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