A recent ruling by the Securities Appellate Tribunal (SAT) provides protection to compliance officers from liability in corporate fraud cases, affirming that they cannot be held accountable for the actions of a company’s promoters or directors. This decision arises from a case where a former company secretary, V Shankar, was penalized by Sebi for misleading investors regarding a buyback announcement. The SAT disagreed with Sebi, stating that compliance officers carry a ministerial role and should not be expected to scrutinize the veracity of audited financial statements approved by the board. The ruling is significant as it clarifies the compliance officer’s role and prevents unwarranted regulatory actions against them. Lawyers suggest that this judgment may set a legal precedent for future cases.