Yes Bank’s penalty stayed by SAT, SEBI had imposed fine of 25 crores rupees

Stock market regulator SEBI has suffered a major setback. SEBI’s Appellate Tribunal [SAT] has stayed the fines of Yes Bank. SEBI had fined Rs 25 crore on Yes Bank only last month.

SAT has asked SEBI to respond to this in 4 weeks. In fact, investors in Yes Bank’s Tier 1 (AT1) bonds had alleged that the bank had misled them. SEBI was investigating this. Following this investigation, Sebi fined the bank last month. SEBI also fined 3 employees of the bank in this.

SAT will hold a final hearing in the case on 31 July. In this case Yes Bank has also been given an opportunity to appeal. SAT said that the Moratorium was implemented in March 2020 under the Banking Regulation Act 1949. SAT said that we have seen that no case has been booked on the relationship manager. Sate said that initially it should be known if the relationship manager had told the investors about the risk factor of this bond. This is the subject of investigation. On the other hand, a member of the private wealth management team has been accused in this, which has been fined.

SAT said that it has also been seen that the risk factor was already on the bank's website and it was in everyone’s knowledge. According to the information, Yes Bank had issued AT-1 bond. It was called Super FD on the lines of FD. It was also promised to give more returns. Investors then approached the Bombay High Court. SEBI found in investigation that it was the bank’s fault and misled investors. On this basis, SEBI fined last month and ordered Yes Bank to fill it within 45 days.

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Dr. Deepak Miglani, Email id.:- legalbuddy@gmail.com