SEBI slaps Rs 50 lakh fine on Kotak Mahindra AMC for violating regulatory norms
India

SEBI slaps Rs 50 lakh fine on Kotak Mahindra AMC for violating regulatory norms

SEBI found lapses on the part of Kotak AMC in carrying out due diligence and barred the fund house from launching new fixed maturity plan schemes for six months.

   
File photo of SEBI Bhavan in Mumbai | Photo: Santosh Verma | Bloomberg

File photo of SEBI Bhavan in Mumbai | Photo: Santosh Verma | Bloomberg

New Delhi: Sebi on Friday imposed a penalty of Rs 50 lakh on Kotak Mahindra Asset Management Company (AMC) and barred the fund house from launching new fixed maturity plan schemes for six months for violating regulatory norms.

The markets regulator also directed the fund house to refund a part of the investment management and advisory fees collected from the unitholders of the six FMP (Fixed Maturity Plan) schemes along with a simple interest at the rate of 15 per cent per annum.

The case relates to the fund house’s investment in certain FMPs. These FMPs of Kotak AMC had invested in Zero Coupon Non-Convertible Debentures (ZCNCDs) issued by Essel Group entities.

Sebi found lapses on the part of Kotak AMC in carrying out due diligence and also flagged the laid back approach adopted by the fund house in risk assessment while taking investment decision vis-a-vis the ZCNCDs of Essel Group entities.


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