ED conducts searches on Franklin Templeton's top management

The Enforcement Directorate has conducted searches at the residence of the top management of Franklin Templeton Mutual Fund, sources tell CNBC TV18. The searches are in connection with irregularities regarding withdrawals of investments from six debt schemes before they were closed on April 23, 2020. According to sources, the searches took place at the residences of CIO Sanjay Sapre, ex- India President Santosh Kamath, ex- Head of APAC Distribution-Vivek Kudva and his wife- Rupa Kudwa.

Franklin Templeton Mutual Fund came under the regulatory scanner after they shut their six debt schemes in April, 2020 leading to several law suits against the fund house across the country. Sebi in its order dated June 7, 2021 had referred to Vivek and Rupa Kudwa's redemption of investments as an "unfair trade practice'. In its statement, Franklin mutual fund said that, "We continue to cooperate with all regulatory and statutory authorities and provide all data and information required by them. Franklin Templeton places great emphasis on compliance with regulations, and we have appropriate policies in place, consistent with Indian regulations and global best practices.”

SEBI in its June, 2021 notification said that Vivek and Rupa Kudva and Rupa Kudva’s late mother Vasanthi redeemed their personal investments from the six debt schemes of Franklin Templeton Mutual Fund based on confidential and non-public information. Franklin Templeton Mutual Fund had suspended redemptions for more than 300,000 investors in its six debt schemes.