Tip It,Lic India
December 11, 2010 by staff
Tip It, The Life Insurance Corporation of India has sent to the Ministry of Finance records relating to investments in nearly 40 companies with findings on. The files were requisitioned by the government a few days before the Central Bureau of Investigation arrested the secretary in charge of investment to the Company.
The officials, however, said none of the funds AND the police are involved and the arrest of the Secretary Chopra Naresh Kumar was a special case of corruption. The CBI, in its request for provisional arrest, alleged that Mr. Chopra had received a bribe for the transmission of inside information with regard to public investment in a host of companies which include, Adani, JP Hydro, JSW Power Ralligear, DB Realty, Pants, Adalite and Mtech. The Bureau alleged that Mr. Chopra has received. 16 lakh paid by Rajesh Sharma, MD of Money Matters, with its partners.
LIC Chairman stated that the Company will hold a separate investigation of its own regarding possible irregularities in the investment department. Although the allegations by the CBI were to transmit sensitive information, according to sources Money Matters has also offers loan brokering on behalf of companies. The Company has called a meeting to consider measures of risk management within the Company and whether any changes are necessary. A few months ago, the Company, at the request of the insurance regulator, had divided the position of operations and monitoring of investments between the two CEOs. Similarly, in the investment department, separate vertical had been created for investment, research and monitoring with each report to different heads.
The board may also decide on a successor to take the place of Ramachandran Nair, CEO of LICHFL, who was arrested by the CBI on allegations that he accepted a bribe and showed undue favor of investments related to DB Realty, Pashmina, Mantri Realty, Sigrun, World Entertainment Lucknow, Indore and treasures of the city that were sent by Mr. Sharma.
Irda had disagreed on the implementation of the investment guidelines of LIC. The Company has not been within the limits prescribed by the regulator for two reasons: first it was subject to separate legislation – the Life Insurance Corporation Act and, secondly, it is not possible to have the same set of investment rules for a company with a. 10, 00,000-crore investment book and with a company. 10,000 crore investment. Sources in LIC said that if the Company has been to respect the boundaries, it has no margin to invest in blue chip companies and would dilute its own standards and invest in securities sub-standard.
Meanwhile, LIC is likely to face a setback in its ambitions to obtain a banking license through its housing finance arm. A draft document by the central bank said bank hopes to license must obtain a “no objection” for the enforcement authorities. A spokesman for the central bank said the guidelines are not definitive.
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