New Delhi: Capital markets regulator SEBI has rejected Sahara Asset Management Company's plea to reconsider an order canceling the portfolio manager licence of the company, saying it was not 'fit and proper' for this business.
The Securities and Exchange Board of India (SEBI), through an order in February, had cancelled the registration of Sahara Asset Management Company (AMC) as portfolio manager.
Rejecting the application, SEBI had said that the company no more meets "fit and proper criteria" to continue as a portfolio manager in Indian securities market.
Following the rejection, Sahara AMC approached capital markets regulator for reconsideration of its decision. In an order dated December 30, SEBI said it has "no hesitation in concluding that Sahara AMC does not comply with the eligibility criteria of being a 'fit and proper person' in accordance with the Portfolio Managers Regulations... in view of the substantial controlling interest entailing significant influence over Sahara AMC, exercised by Subrata Roy Sahara, through the promoter companies of that applicant".
"As envisaged in the 'fit and proper person' criteria, SEBI has to take into account the financial integrity, honesty, good reputation and character of the applicant," the regulator said.
Keeping Sahara AMC in the mainstream market after considering the antecedents of Subrata Roy Sahara and some other companies of the Sahara group may cause prejudice to the interests of investors and the safety and integrity of the securities market.
"I am, therefore, of the firm opinion that the applicant is not a 'fit and proper person' to act as a Portfolio Manager in the Indian securities market also in view of the subsisting action against Subrata Roy Sahara and companies of the Sahara group," SEBI Whole Time Member S Raman said in a 15-pageorder.
Further, SEBI said it did not find any reason to interfere with its order passed in February and accordingly, rejected the application for reconsideration, submitted by Sahara AMC....