SEBI bans Kotak Mahindra AMC from issuing any new FMP schemes for 6 months

Sebi has even charge a penalty of rupees 50 lakh on the mutual fund that is to be paid within 45 days

Kotak Mahindra Asset Management Company was restrained by the Securities and Exchange Board of India (Sebi) from issuing any new fixed maturity plan (FMP) schemes for six months.

 

The restrictions came after Kotak AMC had delayed the payment of full proceeds to investors of six FMP schemes.

 

Sebi has even charged a penalty of rupees 50 lakh on the mutual fund that is to be paid within 45 days.

 

The securities regulator has asked the mutual fund house to refund a part of the investment management and advisory fees collected from unitholders of six FMP schemes with 15 percent interest per annum that will be calculated from the date of FMP maturity to the date of the actual payment.

 

This case concerning to six FMP schemes that were due for maturity in April-May 2019.

 

The fund house had failed to make full recovery at the time of maturities because these schemes had invested in Essel group and other firms, that had defaulted on their payments.

 

Sebi sais that in general this wouldn’t be a problem besides in doing so, the fund house has violated several norms.

India Scanner News Network

Leave a comment