Sebi to empanel administrators to look after refund process

To help it refund money to those duped by fraudsters, regulator Sebi has decided to appoint administrators to supervise the entire refund-payment process including identification of eligible investors and payment of their dues.
This follows an earlier decision by Sebi to empanel third-party agencies to work as receivers for management and sale of assets attached through its regulatory orders for recovery of penalties and investors' money from defaulters.
Sebi was given greater powers by the government earlier this year to crack down on fraudsters and defaulters, while it can now also order refund of monies and disgorgement of ill gotten profits from various entities, which may be distributed to the affected investors.

In this regard, Sebi has now invited applications from entities willing to function as administrators, which can include retired civil servants, retired officers of banks, financial institutions and financial sector regulators.
The upper age limit would be 70 years, while the person would need to have "no criminal/disciplinary proceedings pending against him/her".
"The administrator would be responsible for supervising the process of distribution of the monies," the market regulator said in a notice today.

Among others, the administrator would have to identify the target investors in accordance with the directions issued by Sebi as well as invite applications from the investors for distribution of the amounts.

Besides, they would have to scrutinise the applications received based on the KYC (Know Your Client) documents and weeding out the invalid/multiple such applications.
They would also have to prepare a list of eligible applicants with address, bank account details for refunding the money as well as distribute the money as per the terms and conditions specified by the market regulator.
In addition, they would also have to maintain records of accounts of all transactions.
The administrator will be provided assistance of a Sebi registered intermediary such as merchant bankers, RTI/STA on case to case basis and the expenditure will be borne by the market regulator out of the funds realised for distribution.

Sebi said the remuneration to the administrator would be either on lump sum basis or based on size of investors, quantum of work involved, on case to case basis at the discretion of the market regulator.
The interested candidates can apply by November 20.