Religare Arts ordered to stop running CIS, refund investors
If Religare Arts fails to comply with the order, it will be barred from accessing the market and Sebi will initiate attachment and recovery proceedings
The Securities and Exchange Board of India (Sebi) ordered on Thursday Religare Arts Investment Management Ltd and Religare Arts Initiative Ltd not to collect any money from investors or carry out any collective investment scheme (CIS).
In May 2008, Religare Arts Investment Management, a wholly-owned subsidiary of Religare Arts Initiative (which itself is a unit of Religare Enterprises Ltd) had applied to Sebi for a licence to run a collective investment management company.
Sebi found that Religare Arts Investment Management had collected contributions worth ₹ 11.49 crore from 43 beneficiaries in a scheme named Pratham, a close-ended scheme with the tenure of 36 months.
The object of the scheme was to hold, invest and trade in art, Sebi said. A subsidiary of Religare Enterprises—Religare Finvest Ltd—was one of the beneficiaries mentioned above, which had contributed ₹ 2.25 crore, Sebi said.
On Thursday, Sebi said that since Religare Arts Investment Management did not have a Sebi approval to run a CIS, it has to refund the money collected with returns which are due to the investors within three months and submit a compliance report to Sebi within 15 days of completing the refund.
The market watchdog said in case Religare Arts Investment Management fails to comply with the order, it will be barred from accessing the market and Sebi will initiate attachment and recovery proceedings thereafter.
Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!