Market regulator SEBI on Thursday slapped a penalty of ₹25 lakh each on rating agencies CARE Ratings and ICRA for lack of “due diligence” in credit ratings to non-convertible debentures of Infrastructure Leasing and Financial Services Ltd.
In two separate adjudication orders on Thursday, SEBI also noted that the default in IL&FS has occurred due to “lethargic indifference and needless procrastination and laxity” of the two credit rating agencies.
‘Lethargic indifference’
“The law does not permit any allowance to be made for such lethargic indifference and needless procrastination as found in this case. The brazen failure as found in this case, had clearly defeated the purposes of the Regulations that is investor protection and orderly development of the securities markets,” the order for CARE Ratings said.
