(LiveMint)
Securities and Exchange Board of India (Sebi) in two orders passed on Friday evening found credit ratings agencies or CRAs lapsing and lacking in conduct when they rated the Non Convertible Debentures or NCDs of Infrastructure Leasing and Financial Services Ltd (IL&FS).
In a rare instance the regulator levied a penalty of ₹25 lakh each on three rating agencies ICRA ltd, India Ratings & Research and Care Ratings Ltd for not exercising due-diligence and lapsing on their duties to investors by not taking timely rating actions. Spokesperson of the two rating agencies did not immediately revert to request for comments from Mint. Mint could not reach spokesperson of India Ratings till press time.
It is rare as in the past Sebi for every deficiencies in conduct of rating agencies had either increased regulatory compliances or allowed them to settle the issue via consent. Sebi in past three years has changed the regulations governing CRAs atleast six times.
