The Securities and Exchange Board of India (SEBI) sent a notice to Yes Bank’s former MD and CEO, Rana Kapoor, on Tuesday, directing him to pay Rs 2.22 crore in a case of mis-selling the lender’s Additional Tier-1 (AT-1) bonds. The demand notice came after Kapoor failed to pay the Rs 2 crore fine imposed on him by the SEBI in September 2022.

In the notice, SEBI directed Kapoor to pay Rs 2.22 crore, which includes interest and recovery costs, within 15 days. The regulator warned of arrest and his assets and bank accounts getting attached if the payment is not made within the stipulated time.

It was alleged that the bank and certain officials should have informed investors about the risk involved while selling the AT-1 bonds in the secondary market. The sale of AT-1 bonds started in 2016 and continued till 2019.

SEBI stated in its order that Kapoor handled the secondary sale of AT-1 bonds, took regular updates from the team and gave them further instructions to increase the sales, thus creating pressure on the officials to ramp up the sales.

Additionally, the regulator stated that Kapoor was responsible for misrepresenting or suppressing material facts, manipulation and mis-spelling of AT-1 bonds of Yes Bank to individual investors.

Kapoor allegedly pressured officials of the private wealth management team to devise a devious scheme to dump the AT-1 bonds on hapless customers of Yes Bank.

In the event of non-payment of dues, the market regulator will recover the amount by attaching and selling Kapoor’s moveable and immovable property. Additionally, he might also face arrest.