Franklin Templeton case: ED conducts searches in Mumbai, Chennai

The Enforcement Directorate is conducting searches at some places in Mumbai and Chennai linked to asset manager Franklin Templeton and its former and current executives as part of a money laundering investigation, the officials said on Thursday. 

They stated that the federal agency is looking to gather more evidence as part of its investigation against the company and its promoters under the Prevention of Money Laundering Act (PMLA), according to the news agency PTI. 

In November 2020, capital markets regulator Sebi issued a show-cause notice to the company following its April 2020 decision to wind up six debt schemes having ₹25,000 crore of assets under management (AUM) from 3 lakh investors, citing liquidity challenges because of the pandemic.

The company was asked to pay ₹5 crore as penalty, return over ₹450 crore collected as 22-month investment management and advisory fees, and was banned from launching new debt schemes for alleged irregularities in running the six debt schemes.

Subsequently, the Chennai police economic offences wing (EOW) registered an FIR to probe these alleged irregularities. The ED case of money laundering stems from this complaint, PTI reported. 

In 2021, Sebi restricted the heads of the asset manager--Vivek Kudva and Roopa Kudva--from accessing the securities market and from buying, selling or other dealing on securities for a period of one year. 

(With PTI inputs)