Supreme Court Urges SEBI for Greater Transparency in Investment Fund Disclosures

The Supreme Court has directed TMC MP Mahua Moitra to formally present a representation to SEBI, urging them to enforce public transparency in portfolio holdings of alternative investment funds and foreign portfolio investors. There is a call for clearer disclosure norms to enhance investor awareness and market integrity in India.

On Tuesday, the Supreme Court requested TMC MP Mahua Moitra to submit a comprehensive representation to the Securities and Exchange Board of India (SEBI) emphasizing the need for public disclosure of portfolio holdings in alternative investment funds (AIFs) and foreign portfolio investors (FPIs).

During the hearing, the bench comprising Justices B V Nagarathna and Satish Chandra Sharma made it clear that Moitra’s plea should be reconsidered according to legal protocols once the representation is submitted. Moitra's legal counsel, Advocate Prashant Bhushan, argued that SEBI's existing regulations require mutual funds to disclose investor details, a mandate not extended to AIFs and FPIs.

Despite SEBI's stance on privacy protection, the bench remarked that SEBI has yet to formally apply their judgment to Moitra’s grievances. Bhushan described the current lack of transparency as detrimental to financial market integrity, noting the growing concerns over potential market abuses due to insufficient disclosure norms for AIFs and FPIs.

(With inputs from agencies.)