Market regulator Securities and Exchange Board of India (SEBI) barred Kotak Mahindra Asset Management Company (AMC) from launching any new fixed maturity plans (FMP) for the next six months.
The move has come against delay in payment of full proceeds to investors of six FMP schemes run by the AMC in 2019. FMPs that were due for maturity in April-May, were in fact fully redeemed only in September of that year as per the SEBI order.
SEBI said it noticed that investors of certain FMP schemes launched by the Kotak Mahindra AMC were not paid their full proceeds based on the declared net asset value (NAV).
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Further, apart from this, the market regulator also imposed a penalty of Rs 50 lakh on Kotak Mahindra AMC, which is to be paid within 45 days. Besides, SEBI has also directed the AMC to refund part of the investment management and advisory fees collected from unitholders of six FMP schemes, as per the report.