The (SEBI) has settled a case with BNP Paribas over alleged lapses in granting and re-categorising foreign portfolio investors (FPIs) under the FPI regulations. The settlement amount was fixed at ₹39.97 lakh.
The regulator had initiated adjudication proceedings against the firm for violations of various provisions of the SEBI (Foreign Portfolio Investors) Regulations, 2014 and 2019, as well as related operational guidelines. SEBI alleged that BNP Paribas had wrongly granted Category II registration to six FPIs not eligible under the 2014 norms, and later re-categorised them as Category I without verifying their regulatory status under the UK Financial Conduct Authority.
A show cause notice was issued to the firm in February this year. Pending the adjudication, BNP Paribas filed a settlement application under the settlement proceedings regulations, proposing to resolve the matter without admitting or denying the findings.
After reviewing the proposal, SEBI’s internal committee recommended a settlement amount of ₹39.97 lakh, which was later approved by the High Powered Advisory Committee and the Whole Time Members in September. The company remitted the amount in October, following which the adjudication proceedings were formally disposed.
The settlement order, passed by SEBI said that the order would take immediate effect. However, SEBI reserved the right to reopen the case if it finds that the applicant made incomplete disclosures or violated the settlement terms