Franklin Templeton to challenge Sebi order at Securities Appellate Tribunal

My personal transactions have been conducted in good faith and with no intent to gain unfair benefit, says Vivek Kudva.

Franklin Templeton Asset Management (India) on Tuesday said it strongly disagreed with Sebi’s order on the closure of its six debt schemes and would challenge the direction at  the Securities Appellate Tribunal (SAT).

On Monday, the Securities and Exchange Board of India (Sebi) barred the fund house from launching debt schemes for two years. Sebi also imposed a penalty of Rs 5 crore on Franklin.

“We strongly disagree with the findings of the Sebi order and intend to file an appeal with SAT,’’ the fund house said in a statement today.

Franklin Templeton said it placed great emphasis on compliance and believes it has always acted in the best interest of the unitholders and in accordance with regulations.

Franklin said the net asset value of each of the six schemes at present is higher than what they were on April 23, 2020. “We believe this supports the decision made by the trustee in consultation with the AMC and its investment management team to wind up the six schemes.”

Kudva ban

Sebi has also barred Vivek Kudva, former head of Asia Pacific (APAC) for Franklin Templeton, and his wife Roopa Kudva from the securities market for one year.

Sebi said the couple had cumulatively redeemed units worth Rs 30.70 crore while in possession of material non-public information.

Vivek Kudva has been  asked to pay a penalty of Rs 4 crore, while a fine of Rs 3 crore has been imposed on Roopa Kudva.

Vivek Kudva said he is reviewing the order and considering appropriate next steps which may include filing an appeal before the SAT.

“I have always acted in accordance with Sebi regulations, including in this instance.

My personal transactions in the two schemes (under winding-up) have been conducted in good faith and with no intent to gain unfair benefit,” he said.

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