Six debt schemes of Franklin get ₹1,147 cr

Suresh P Iyengar Mumbai | Updated on June 17, 2021

From coupons, sale of assets in the fortnight ended June 15

The six suspended debt schemes of Franklin Templeton have received ₹1,147 crore from coupons, sale and maturity of assets held in the scheme as of June 15.

The Franklin Templeton Ultra Short Bond Fund has received the highest inflow of ₹645 crore followed by Short Term Income Plan inflow of ₹276 crore. The Low Duration and Income Opportunity Fund have received ₹71 crore and ₹70 crore while Credit Risk and Dynamic Accural funds have got ₹62 crore and ₹24 crore.

Between last April and June 15, the six schemes under winding up have received ₹23,140 crore from maturities, pre-payments, sale and coupons. The schemes have distributed ₹17,778 crore in four tranches to the unitholders and repaid ₹4,476 crore debt raised by these funds to meet redemption early last year.

Also read: FT Trustees, employees to move SAT against SEBI’s penalty

The asset under management of these six schemes as of June 15 was ₹9,441 crore.

Earlier, SEBI has found serious lapses by the fund house and asked to refund ₹512 crore of investment management and advisory fees collected from June 4, 2018, to April 23, 2020, with respect to the six debt schemes along with simple interest of 12 per cent per annum. It also imposed a penalty of ₹5 crore. Franklin Templeton India was also barred from launching any new debt scheme for two years.

₹15 crore fine

In a separate order, SEBI imposed a cumulative fine of ₹15 crore on Franklin Templeton Trustee Services and eight senior official and fund managers associated with the six debt schemes wound-up by the fund house.

SEBI has levied a fine of ₹3 crore on Franklin Templeton Trustee Services Pvt Ltd, and ₹2 crore each on Franklin Asset Management (India) Pvt Ltd President Sanjay Sapre and its Chief Investment Officer Santosh Kamat.

The market watchdog has also imposed a penalty of ₹1.5 crore each on Kunal Agarwal, Sumit Gupta, Pallab Roy, Sachin Padwal Desai and Umesh Sharma, who acted as fund managers for various Franklin Templeton schemes at the time of violation. It has also fined chief compliance officer Saurabh Gangrade of ₹50 lakh.

However, both the fund house, its Trustee co and employees have moved Securities Appellate Tribunal against Sebi findings and penalty.

Published on June 17, 2021

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