Nippon India Mutual Fund Under CBI Scanner for Investments in NCDs
CBI Investigation
Nippon India Mutual Fund, which used to be called Reliance Mutual Fund, is being looked into by the Central Bureau of Investigation (CBI) for putting Rs 950 crore into non-convertible debentures (NCDs) of Morgan Credit Private Limited, a company owned by the Rana Kapoor family.
Multi-Agency Investigation
The CBI is not the only one investigating. The Securities and Exchange Board of India (SEBI) is also involved. They are checking out investments totaling around Rs 2,850 crore made by companies that were once owned by Reliance Capital in AT1 bonds issued by Yes Bank.
Document Request
The CBI has asked Nippon India Mutual Fund for documents related to the investments made in April 2018. They requested these documents on December 21.
Sebi Show Cause Notice
SEBI sent a show-cause notice in August to Nippon India Mutual Fund and others involved in the transactions. This includes Anil Ambani, his son Jai Anmol Ambani, Rana Kapoor, and top executives of Nippon India MF.
Allegations
The investigation is looking into transactions between Yes Bank and companies previously owned by Reliance Capital. SEBI alleges that there may have been some kind of “quid pro quo” arrangements going on.
Quid Pro Quo Alleged
SEBI claims that Yes Bank provided funds to Reliance Home Finance and other companies in exchange for investments in NCDs. This alleged arrangement took place between 2016 and 2020.
Stock Exchange Statement
Nippon Life India Asset Management confirmed receiving a show-cause notice from SEBI. The notice is related to investments made in AT-1 Bonds of Yes Bank by then Reliance Mutual Fund.
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Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.