The special investigation team(SIT)on black money has asked the Securities and Exchange Board of India (Sebi)to furnish the details of all those investing through participatory notes (P-Notes),according to sources in the know.
This is the first time the government -constituted body has sought such massive amount of data,which includes the list of beneficial ownersand transfer trial sof investors taking the PNote route to invest in domestic equity and debt markets.
The markets regulator,Sebi, which recently tightened the disclosure requirement for P-Notes, has already furnished the information to the SIT and the exercise would take a few more weeks to complete,sources added.
The SIT wants to ensure that there gulatory changes made by Sebi are sufficient to curb misuse of tools,particularly with respect to end beneficiaries.
The expert panel is concerned that the P-Note route coulds till be used by Indian companies to bring back unaccounted money, one of the officials who works closely with the SIT team has said. According to sources,the investigative team will examine the data provided by Sebi thoroughly as they suspect some links between the individuals linked to off shore companies floated by Panama law firm Mossack Fonseca.
P-Notes allow foreign investors to take exposure to Indian stocks without registering with Sebi.
These instruments are issued by foreign portfolio investors(FPIs)registered with Sebi.Early this year,Sebi had increased the know-your-customer(KYC)requirement, issued curbson transferability,and prescribed more stringent reporting for PNotes issuers and holders.
Business Standard New Delhi,13th October 2016
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