The accounts of three foreign funds, which together own shares worth over Rs 43,500 crore in four companies of the Adani Group, have been frozen by the National Securities Depositories Ltd (NSDL), The Economic Times reported on Monday.
As per the NSDL website, the accounts of Albula Investment Fund, Cresta Fund and APMS Investment Fund were frozen on or prior to May 31, it added.
These funds are based out of Mauritius and are registered with the Securities and Exchange Board of India (SEBI) under the category of foreign portfolio investors (FPIs).
Top officials from custodian banks and law firms dealing with foreign investors told ET that this freeze could be due to disclosure of insufficient information on beneficial ownership as mandated by the Prevention of Money Laundering Act (PMLA).
“Custodians typically warn their clients before such action but if the fund doesn’t respond or fails to comply, accounts can be frozen,” an official told the paper.
All three of them registered under the same address in Port Louis have a holding of 6.82 percent in Adani Enterprises, 8.03 percent in Adani Transmission, 5.92 percent in Adani Total Gas and 3.58 percent in Adani Green.
As per PMLA, SEBI had refurbished the “know your customer” (KYC) documentation for FPIs in 2019. The new rules require FPIs to submit extra details related to the disclosures on common ownership along with personal details of key employees of the fund such as fund managers.
The report also said that SEBI is investigating if there was any price manipulation in Adani Group stocks. The prices of Adani Group stocks saw a rise between 200 percent and 1000 percent in the past one year.
"Sebi initiated a probe in 2020 and the investigation is still ongoing," a person familiar with the matter told the paper.