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Sebi didn't give Franklin nod to shut down debt scheme, says report

Sebi didn't give Franklin nod to shut down debt scheme, says report

Sebi didn't give Franklin nod to shut down debt scheme, says report
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By CNBCTV18.com Aug 27, 2020 1:10:57 PM IST (Published)

The Khambatta family had petitioned the Gujarat high court contending that the asset manager’s decision to wind up the schemes required the consent of investors.

Franklin Templeton India shut down six of its struggling debt schemes without the approval of Sebi, a report by Hindustan Times said, quoting an RTI query filed by the Khambatta family.

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Earlier, the Khambatta family, who invested in the Franklin Templeton funds, had petitioned the Gujarat high court contending that the asset manager’s decision to wind up the schemes required the consent of investors. This, in turn, had led to the court staying the winding-up process on June 8.
“We have not made any statement before the Hon’ble High Court of Gujarat or the Hon’ble Supreme Court about Sebi granting us prior permission to wind up these six schemes. As clearly stated in all our communications, the decision to wind up these schemes was taken in accordance with regulation 39(2)(a),” said a spokesperson for Franklin Templeton in an emailed statement as per the report.
The revelation by Sebi comes as a setback to Franklin that had claimed that the regulator was informed about the winding up of schemes at every step citing severe illiquidity and redemption pressures due to coronavirus pandemic.
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