In case of present mandates, JM Financial can proceed to behave as a lead supervisor for public challenge of debt securities for a interval of 60 days, Sebi says in its interim order. (Representative picture)
Sebi’s order comes after Sebi undertook a routine examination of the general public problems with Non-Convertible Debentures through the yr 2023
The Securities and Exchange Board of India (Sebi) on Thursday barred JM Financial Ltd from taking new mandate for appearing as a lead supervisor for any public challenge of debt securities, for indulging in unfair commerce practices. However, in case of present mandates, JM Financial can proceed to behave as a lead supervisor for public challenge of debt securities for a interval of 60 days, Sebi stated in its interim order.
This got here days after the Reserve Bank barred JM Financial Products Ltd from offering any type of financing in opposition to shares and debentures, together with sanction and disbursal of loans in opposition to preliminary public providing. Sebi’s order got here after the regulator undertook a routine examination of the general public problems with Non-Convertible Debentures (NCD) through the yr 2023.
“The regulator noted that noticee (JM Financial) along with its connected group entities were prima facie noted to have given an assured exit to certain investors at a profit thereby incentivising them to apply in the public issue in contravention of the regulatory mandates,” it added. It additional stated the motion of JM Financial seems to be an unfair commerce observe.
On March 5, the RBI had imposed restrictions on JM Financial Products Ltd after discovering that the corporate indulged in varied manipulations, together with repeatedly serving to a bunch of its clients to bid for varied IPOs by utilizing loaned funds. The restrictions had been with fast impact.
It barred the systemically vital non-deposit-taking NBFC from offering any sort of financing in opposition to shares and debentures, together with sanction and disbursal of loans in opposition to IPO of shares as properly as in opposition to subscription to debentures.
Besides directing the entity from “cease and desist” from financing actions, the RBI stated it’s individually analyzing any attainable regulatory violations and deficiencies on the a part of the banks involved.
