It was in April last year, that Franklin Templeton (FT) the global giant, announced the sudden closure of 6 debt mutual funds schemes, putting investor money of about Rs. 30000 crores in utter uncertainty. The sudden closure of these MF schemes meant that the investor money was stuck till maturity of the funds, with no exit till then and the looming uncertainty about valuation and ultimate realisation of investor dues. While panic spread among the investors and there were fears of a contagion effect, a quick look at the portfolio of each of the six funds showed a pathetic portfolio, clearly indicating a mismanagement of funds. Its high profile CEO and fund managers had made questionable investments in illiquid securities of unlisted companies, with uncertain returns and exit too. The investors and the authorities, both cried foul, even though Franklin Templeton, with worldwide assets of over $ 700bn under its management, denied any mismanagement or violations and falsely assured investors that a majority of the investments are in superior quality security and that the funds have enough liquidity to take care of redemptions. It said that the decision to close the funds was taken to protect investor interests, via a managed sale of the portfolios.
#FranklinTempleton #SEBI #ED
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