Franklin Templeton: No effect on other schemes of the fund house, but will keep an eye on SEBI’s investigation

Frankin Templeton has been barred by SEBI from launching any debt scheme for two years.

SEBI last week ordered Franklin Templeton Mutual Fund House to refund Rs 512 crore management and advisory fees to investors of its six debt schemes. Along with this, a fine of Rs 5 crore was also imposed on it. But this move of SEBI may not have an immediate effect on its other schemes. However, the public eye remains on the investigation against the employees of the fund house. Ajay Kejriwal, President, Choice Broking, told Financial Express Online that SEBI is investigating some employees of Franklin Templeton. If SEBI finds any fault with them, then there can be a big impact. SEBI has currently barred Franklin Templeton AMC from launching any debt scheme for two years. The company has also been fined Rs 5 crore for winding up its six debt schemes last year.

no chance of bankruptcy

Deepak Shenoy, founder of Capital Mind, says that so far the stand of Franklin Templeton in this matter has not been known. The fund house has money so it will not go bankrupt. The question is whether the fund house will give money to the investors or not. That is the real question. Analysts say that Franklin Templeton’s parent company is very strong and has over two decades of business experience in India. It has substantial funds, so its current Indian operations will not be affected despite SEBI’s action. Franklin Templeton started business in India in 1996. Its current AUM is 80 thousand crore rupees. At present it has 73 funds.

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SEBI has taken tough steps

In its order, SEBI has banned Franklin Templeton’s former head of Asia-Pacific region Vivek Kadva and his wife Roopa Kadva from trading in securities market for one year. SEBI has also imposed a total fine of Rs 7 crore on the couple. Both are alleged to have possessed some highly sensitive information, before which they encashed units of Franklin Templeton Mutual Fund worth Rs 30.70 crore.