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- Franklin Templeton Vs SEBI; Stock Market Regulator Imposed Penalty Of Rs 16 Crore
Mumbai2 hours ago
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- This amount has to be paid within 45 days. It also has the director’s wife and relative.
The stock market regulator has taken major action on Franklin Templeton Mutual Fund. It imposed a fine of Rs 16 crore on 11 directors and employees on Monday. This amount has to be paid within 45 days. It also has the director’s wife and relative.
4 separate orders issued
SEBI issued a total of 4 orders separately in this matter on Monday. A total of 9 people have been fined Rs 15 crore in the information given in page 151 in the first order. In this, Franklin Templeton Rs 3 crore, CEO Sanjay Sapre Rs 2 crore, CIO Santosh Kamat Rs 2 crore, Fund Manager Kunal Agarwal, Fund Manager Sumit Gupta, Fund Manager Pallab Roy, Fund Manager Sachin Desai and Umesh Sharma 1.5-1.5. Has imposed a fine of Rs. A penalty of Rs 50 lakh has been imposed on Saurabh Gangarde.
The investment strategy has remained the same
SEBI said in the order that despite the different investment objectives, the same investment strategy was adopted in 6 schemes. These 6 schemes had higher exposure to AA and below corporate bonds. It was also found that more than 70% of the investments were made in debt securities. SEBI found that the interest calculated for the same was wrongly calculated.
Director fined Rs 45 lakh
An order has been given to pay a penalty of Rs 45 lakh on Venkata Radhakrishnan and Rs 5 lakh on Malathi Radhakrishnan in 45 days. Venkata Radhakrishnan is a director in the company while Malathi is his wife. Both of them had withdrawn their investment money on March 23, a month before the closure of this scheme. SEBI said that Radhakrishnan was aware that there was tension in the fixed income scheme. The board meeting was also held on 23 March itself. These people had also applied to SEBI for settlement, but SEBI rejected it.
5 crore fine on Myvish Market
Similarly, SEBI has imposed a fine of Rs 5 crore on Myvish Market Place. It had withdrawn Rs 22.11 crore from the company’s scheme between March 6 and March 11. In this, Alok Sethi was the trustee of Franklin and he was the director of the board. Similarly, a penalty of Rs 25 lakh has been imposed on Jairam S Iyer. He is also a director in the company. He had withdrawn Rs 4.56 lakh from the scheme on 23 March.
Significantly, Franklin India Loan Duration Fund, Ultra Short Fund, Short Term Income Fund, Credit Risk Fund, Dynamic Accrual Fund and Income Opportunities Fund were closed on April 23. SEBI had investigated forensic audit in this.
Last week also took action
Earlier last week, SEBI had barred the fund house from launching any debt fund for the next two years. Along with this, a fine of Rs 5 crore was also imposed on it. SEBI has given this information in an order. Along with this, orders have also been given to return Rs 22 crore to Roopa Kudva, Vivek Kudva and their mother. SEBI said that Vivek Kudva gave information related to the company to his wife and on this basis the money was withdrawn before the scheme was closed.
Unit holders of fees back to do will be
SEBI has said in the order that Franklin Templeton will also have to refund the investment management and advisory fees taken from the unit holders of the debt scheme between June 4, 2018 to April 23, 2020 along with interest. This amount will be around Rs 512 crore. This amount will have to be paid to the unit holders within 21 days. This order of SEBI comes in connection with the sudden closure of its 6 debt scheme by Franklin Templeton in April 2020.
26 thousand crore rupees were trapped by investors
The asset under management of the discontinued schemes was about 26 thousand crores. Asset under management means the amount of money invested by the investors in that scheme. SEBI said in the order that it has been found that a number of irregularities have been found in the debt scheme of Franklin Templeton. Due diligence in this was also not done properly. Also the risk management framework was not correct.