Societe Generale says it is fully cooperating with Sebi

When asked about Societe Generale's response to the Sebi action, a spokesperson told PTI that the company is fully cooperating with the market regulator.

"Societe Generale is cooperating fully with Sebi and is looking at providing all the information required within the 30 days specified period," the official said in an email statement from France.

The Securities and Exchange Board has sought explanation from the France-based financial services giant for furnishing wrong information on issuance of overseas derivative instruments (ODIs) which enabled a foreign entity to invest in the Anil Ambani-led Reliance Communications.

Noting that the firm has violated the FII norms, Sebi has banned it from issuing any fresh ODIs till it comes out with correct information.

Sebi has also asked the French FII to explain why its registration as an FII should not be cancelled for giving wrong details.

The Sebi order and show-cause came after the company gave incorrect information on ODIs issued to one Hythe Securities. These instruments' underlying securities were of RCom.Societe Generale has 30 days to respond to the Sebi notice.

"I hereby direct Societe Generale... not to issue/subscribe or otherwise transact in any fresh/new ODIs till such time it provides a true and correct reporting of its ODI transactions to Sebi," whole-time member of Sebi KM Abraham said in his order issued on January 15.

According to the market regulator, the French entity failed to report about the ultimate beneficiaries of those ODIs, which were subsequently issued downstream to Opportunite SA and then to Pluri.

"ODIs were issued afresh overlooking the regulatory requirements...It (Societe Generale) further continued to misrepresent that the ODIs were not issued back to back to any other entity," the regulator said.