RBI plans a special audit for breaches by IIFL Finance, JM Financial Products Ltd
IIFL Finance Ltd and JM Financial Products Ltd (JMFPL) will undergo a special audit to further probe their regulatory breaches, as the RBI has initiated the process for the appointment of auditors.
The Reserve Bank of India (RBI) has floated two separate tenders for the appointment of auditors for special audit of these two companies.
Audit firms empanelled by the Securities and Exchange Board of India for forensic audit can participate in the tendering process, and the last date for submission of bids is April 8, as per the tender document published by the RBI. The selected firms will be awarded work on April 12, as per the bid documents. Earlier this month, the RBI put a curb on these two entities for non-compliance of regulatory guidelines.
The RBI barred IIFL Finance from sanctioning or disbursing gold loans after certain material supervisory concerns were observed in its gold loan portfolio. It had said an inspection of the company was carried out by it with reference to IIFL's financial position as of March 31, 2023.
«Certain material supervisory concerns were observed in the gold loan portfolio of the company, including serious deviations in assaying and certifying purity and net weight of the gold at the time of sanction of loans and at the time of auction upon default,» the RBI had said. These practices, apart from being regulatory violations, also significantly and adversely impact the interest of the customers, it added.
A day after, the RBI imposed restrictions on JM Financial Products Ltd following
