According to a settlement order issued by the Securities and Exchange Board of India (SEBI) on November 26, the AMC was found to have incurred excess expenses in managing a mutual fund scheme, violating Clause A(1) of SEBI circulars dated October 22, 2018.
Additionally, the trustee company was cited for failing to ensure compliance by Axis AMC, thereby contravening provisions under SEBI (Mutual Funds) Regulations.
Also read: Axis MF launches Momentum Fund; NFO open till December 6
Clause A(1) stipulates that all scheme-related expenses, including distributor commissions, must be paid from the scheme itself within regulatory limits. These expenses cannot be covered by the books of the AMC, its sponsors, associates, or trustees.
Axis AMC and its trustee had filed a settlement application on June 4, 2024, requesting SEBI to resolve the proceedings without admitting or denying the findings.
After a thorough review by SEBI’s Internal Committee and the High Powered Advisory Committee, the Panel of Whole-Time Members approved the settlement terms on November 6, 2024. The decision was communicated to the parties on November 13.
