Sebi may tighten AIF regulations to better monitor the source of funding

The regulator may also conduct regulatory audits on the AIFs to examine the fund sourcing arrangements with investors to ensure that the present regulations are not violated

The Securities and Exchange Board of India (Sebi) plans to tighten regulations for Alternative Investment Funds (AIF) to better monitor the source of funding and their end use.
 
According to sources, Sebi may check anti-money laundering policies implemented by AIFs and examine the sanctity of back-end arrangements that investment vehicles might have with investors. The move is to prevent instances where money raised in AIFs is invested back in entities owned by the investors.
 
The regulator might also conduct regulatory audits on AIFs to examine fund sourcing arrangements in order to ensure regulations are not violated.
 
“Sebi