Sebi Cracks Down on Karvy Entities, Cancels Registrations

Sebi revoked the registration of Karvy Capital Alternative Investment Trust and KCAP Alternative Investment Fund for not meeting 'fit and proper person' standards. Karvy Stock Broking Ltd owns these entities but failed to divest holdings as required, prompting regulatory action against these funds under SEBI's market laws and intermediaries norms.

The Securities and Exchange Board of India (Sebi) cancelled the registration of two Karvy Stock Broking entities on Tuesday, citing non-compliance with the 'fit and proper person' criteria mandated by market laws.

The entities in question, Karvy Capital Alternative Investment Trust and KCAP Alternative Investment Fund, are managed by Karvy Capital Ltd, a subsidiary of Karvy Stock Broking Ltd (KSBL).

Despite regulatory orders for KSBL to divest its holdings after being disqualified, the required disinvestment did not occur, leading to the recent enforcement actions by Sebi.