BOI AXA Investment Managers and five persons on Wednesday settled with markets regulator Sebi a case pertaining to an alleged violation of market norms after paying Rs 3.92 crore towards the settlement amount.BOI AXA Investment Managers (now known as Bank of India Investment Managers) is an asset management company (AMC).Apart from BOI AXA, the five persons who settled the case are — Rajesh Chawathe, Sandeep Dasgupta, Jayati Dasgupta, Anurupa Dasgupta and Alok Singh.
The order comes after the entities approached Sebi to settle the proceedings initiated against them “without admitting or denying the findings of fact and conclusions of law” through a settlement order.In the settlement order, Sebi said, “The adjudication proceedings initiated against applicants vide SCN dated May 2, 2022, are disposed of”.As per the order, the regulator conducted a thematic inspection of BOI AXA Mutual Fund for the period August 2018 to February 2019 to verify the books of accounts, records and other documents pertaining to the mutual fund with respect to Inter Scheme Transfers (ISTs) and valuation of downgraded debt securities.
Pursuant to the inspection, Sebi initiated adjudication proceedings and subsequently issued a show-cause notice to them in this regard in May. In the show cause notice, it was alleged that ISTs of BOI AXA resulted in the transfer of high-risk securities to schemes that were categorised as low/medium risk, which did not conform to their investment objectives.
BOI AXA failed to value securities in accordance with fair valuations and also failed to follow its own approved valuation policy by arbitrarily deciding the figure of per-day provisioning and continued with per-day provisioning ignoring material events.It was also alleged that five persons failed to comply with the norms.Pending adjudication proceedings, the applicants proposed to settle the instant proceedings against them and filed settlement applications in July.
Thereafter, Sebi’s committee recommended that the case for the settlement upon the payment of Rs 3.92 crore by the applicants. The applicants had informed the market watchdog about the remittance of the settlement amount in December and Sebi has confirmed the credit of the same.