SEBI has imposed Rs 5 lakh fine on Head of Customer Service of Taurus Mutual Fund, Sasidhar V for alleged tampering of Date and Time Stamping Machine (DTSM) to favour select few investors.
SEBI said that Sasidhar V deliberately tampered the DTSM which are used to stamp date and time of mutual fund application. He did it to favour certain investors so that their units can be redeemed at a higher NAV.
SEBI notes that these investors whom Sasidhar V favoured were holding units of Taurus Liquid Fund, Taurus Dynamic Income Fund, Taurus Ultra Short Term Bond Fund and Taurus Short Term Income Fund. These 4 debt schemes had exposure in debt securities issued by Ballarpur Industries Ltd (BILT).
On February 20, 2017, February 22, 2017 and February 27, 2017, BILT defaulted on its payment obligation of Rs 45 crores, Rs 39.75 crores and Rs 22.25 crores respectively. Consequently, the fund house marked down the value of the BILT securities to zero and decided to suspend subscription in the affected schemes from February 23, 2017.
SEBI during its investigation found out that Sasidhar was in possession of the password of DTSM with which he would have changed the time stamping of the various requests received by Taurus MF to ensure certain investors get a higher NAV i.e. the NAV before mark down of BILT securities.
As a result, the market regulator imposed a penalty of Rs 5 lakh on Sasidhar V and asked him to pay it within a period of 45 days. However, as the covid-19 pandemic has resulted in lockdown till August 31, 2020, Sasidhar V's 45-day period to pay the penalty will come into force on September 01, 2020 or at the end of the lockdown, if it is extended beyond August 31, 2020.
