SEBI- Franklin Templeton case

Franklin Templeton (FT) has been given interim relief from Securities Appellate Tribunal (SAT) on June 28, 2021.

Key points

SAT put stay on Securities Exchange Board of India’s (SEBI) order on FT that prevented it from launching new debt scheme. Tribunal also put a temporarily stayed on SEBI’s order of recovery of Rs 512 crore from Franklin Templeton and its direction on FT to deposit Rs 250 crore in three weeks.  Next hearing on Franklin Templeton-SEBI’s matter will be on August 30, 2021. Order of SAT will be applicable until further orders from it.

Background

SEBI had put a penalty of Rs 5 crore and ordered to disgorge Rs 512 crore investment management by fund house to manage six suspended schemes. Fine of Rs 3 crore was levied on Franklin Templeton Trustee Services Pvt Ltd while Rs 2 crore each on President of Franklin Asset Management (India) Pvt Sanjay Sapre and its Chief Investment Officer Santosh Kamat. Sebi had also imposed a penalty of Rs 15 crore on senior officials of Franklin Templeton AMC and its trustee because they violated regulatory norms in case of winding up of six debt schemes in 2020.

What are those schemes?

Six of the schemes namely, Franklin India Low Duration Fund, Franklin India Credit Risk Fund, Franklin India Dynamic Accrual Fund, Franklin India Ultra Short Bond Fund, Franklin India Short Term Income Plan, and Franklin India Income Opportunities Fund, together had an estimated Rs 25,000 crore as assets under management.

Franklin Templeton

It is a global investment firm which was founded in New York City in 1947. It is listed on the New York Stock Exchange under ticker symbol BEN. Company has been named so in honor of Benjamin Franklin.

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