The Enforcement Directorate (ED) has registered a case of money laundering against asset management company Franklin Templeton and its senior officials.
In April last year, Franklin Templeton had shut down its six debt mutual fund schemes citing redemption pressures and lack of liquidity in bond market in the wake of the COVID-19 pandemic.
The ED has registered an Enforcement Case Information Report (ECIR) against Franklin Templeton based on a First Information Report (FIR) filed at the Chennai Police Economic Offences Wing, MoneyControl reported citing multiple sources.
A forensic audit of Franklin Templeton showed that its officials sold their investments in mutual fund schemes just before their closure. The ED will investigate if the gains made by the officials can be treated as proceeds of crime under the Prevention of Money Laundering Act (PMLA), one of the sources said.
The ED has charged Franklin Templeton and its CIO with cheating and hatching criminal conspiracy to defraud investors and making unlawful gains.
The six shut mutual fund schemes had an estimated Rs 25,000 crore as assets under management (AUM). Till January 29, 2021 these six schemes had received total cash flows of Rs 14,391 crore from maturities, pre-payments and coupon payments since their closing down on April 24 last year.