ICICI Venture Funds Management, 4 others pay over Rs 5.2 cr to settle case with Sebi

ICICI Venture Funds Management Company and four other entities settled with Sebi a case of alleged violation of norms pertaining to venture capital funds by paying a total of more than Rs 5.2 crore towards settlement charges.

They were also alleged to have violated Prohibition of Fraudulent and Unfair Trade Practices regulations, Sebi said in five separate but similarly-worded orders.

India Advantage fund III, India Advantage fund IV, Dynamic India Fund III and Dynamic India Fund IV are the other four entities besides ICICI Venture Funds Management which have settled the case.

Sebi noted that ICICI Venture Funds Management was acting as investment manager to India Advantage fund III and India Advantage fund IV.

In addition, it was also acting as sponsor to foreign venture capital investors -- Dynamic India Fund III and Dynamic India Fund IV.

The allegations against them included factual misrepresentation to investors with regard to registration status, inadequate information and lack of clarity in proposals for extension, liquidity and consent of investors.

Besides, it was also alleged that management of the funds was not in accordance with the terms and conditions specified in the private placement memorandum.

However, pending proceedings, the entities filed settlement applications with the regulator without admitting or denying the guilt.

The settlement terms proposed by them were considered by the regulator's High Powered Advisory Committee (HPAC). The committee recommended the cases for settlement on payment of an amount totalling Rs 5,21,92,635 by them.

The recommendation of HPAC was also accepted by the panel of whole time members of Sebi.

Accordingly, the three entities paid their respective settlement amounts, following which the Securities and Exchange Board of India (Sebi) settled the proposed adjudication proceedings.

Sebi said that enforcement actions, including commencing or reopening of the proceedings, could be initiated if any representation made by them is found to be untrue.