Madras High Court notice to Franklin Templeton, SEBI

PIL filed against closure of 6 schemes

The Madras High Court has issued notices to the Securities and Exchange Board of India (SEBI) along with Franklin Templeton Mutual Fund and its top officials after a public interest litigation (PIL) was filed by a Chennai-based group against the abrupt winding up of six debt schemes by the fund house last month.

The court, on May 26, passed an interim order while directing SEBI to file a status report. The PIL has been filed by the Chennai Financial Markets Accountability (CFMA).

CFMA also plans to get more unit holders of the affected schemes through an online petition, which it then plans to file with the Securities and Exchange Commission (SEC) as the parent entity Franklin Templeton Investments is based in the U.S. The PIL alleged that while the fund house had said that recovery of the money could take around five years, the approximate quantum of loss to the investors would be ₹22,400 crore.

Responding to an email query by The Hindu, a spokesperson for Franklin Templeton MF said the fund house is examining the matter and will take appropriate steps as may be required. An email query sent to SEBI remained unanswered till the time of going to press.