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Franklin Templeton top brass put self-interest first
Investigations into closure of six debt mutual fund schemes uncover details of how some executives pulled out their investments and interfered in risk assessment.
1 March, 2021•13 min
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1 March, 2021•13 min
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Editor's note: The Franklin Templeton India can of worms is a gift that keeps on giving. Investigations into the mess have uncovered fresh details of how the fund house’s top executives, their family members and trustees jumped ship before it shut down its suite of six debt mutual fund schemes on 23 April last year. In a case that smacks of insider trading, the forensic audit commissioned by the Securities and Exchange Board of India has found 23 instances of top executives and connected entities withdrawing Rs 56 crore in March and April, ahead of the schemes being shut down for redemptions on 23 April 2020. These withdrawals took place even as the schemes resorted to heavy borrowing from banks to honour the redemption requests. Excerpts of the audit report have been reviewed by The Morning Context. These withdrawals by key managerial personnel were first reported by Manoj Nagpal, consulting editor at financial news publisher Moneycontrol. Franklin Templeton, which specialises in investing in riskier, lower-rated bonds for slightly higher returns, has always boasted of its impeccable risk management processes. However, the audit …
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