SEBI Settles ICICI Prudential VC Scheme Violation: How Delay in Fund Wind-Up Costed Rs 14.35 Lakh
ICICI Prudential Asset Management Company (AMC) and two associated entities have successfully concluded a regulatory matter with SEBI. The settlement addressed alleged violations concerning substantial delays in the winding up of a specific venture capital fund scheme. The total payment made to resolve the proceedings amounted to Rs 14.35 lakh.The matter highlights the stringent compliance environment governing asset management and fund structures in India. The entities, including ICICI Prudential Venture Capital Fund and ICICI Prudential Trust, approached SEBI via suo-motu settlement applications. They proposed settling the alleged violations while reserving the right of "neither admitting nor denying the findings of facts and conclusions of law."
Details of the Settled Venture Capital Fund Scheme
The case centered on the operational timeline of the ICICI Prudential Venture Capital Fund- Real Estate Scheme- I. The scheme was originally constituted on September 26, 2013, with an initial tenure set for four years.As the scheme progressed, its term underwent multiple extensions. SEBI noted that the tenure was first extended for two years, lasting until September 2019. Following this, the scheme was further expanded with two subsequent extensions of two years each. The fund officially expired on September 25, 2023$.
Scope of the Regulatory Violation
The regulatory focus was on the process of winding up and the subsequent distribution of proceeds to the investors. While the liquidation and exit of all investments were completed on December 25, 2023, SEBI observed a significant delay.The regulator determined that the winding-up process was delayed by an approximate period of four years before the proceeds could finally be distributed to the respective investors. This delay formed the basis of the alleged violations leading to the current settlement.
Final Compliance and Settlement Order
Upon receipt of the comprehensive settlement applications, SEBI's internal committee reviewed the matter. The committee subsequently recommended that the applying entities jointly and severally pay an amount of Rs 14.35 lakh.The applicants duly remitted the required payment to the regulatory body. In a final order, SEBI confirmed the resolution, stating that any proceedings that may have been initiated for these specific violations are hereby settled with respect to the applicants.
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