Sebi asks MF trustees to be more proactive, not wait for regulator to act

Sebi chief Ajay Tyagi urges MFs to be more careful investing in high-yield debt instruments and not choose returns over safety

The Securities and Exchange Board of India (Sebi) chairman Ajay Tyagi on Tuesday directed mutual fund (MF) trustees to act with more urgency when they spot lapses, rather than wait for the regulator to intervene.

Tyagi also asked MFs to be more careful when investing in high-yield debt instruments and not choose returns over safety.

The chairman cited Sebi's inspection report, which had highlighted some lapses that were “quite prevalent in the industry as a whole".

Tyagi added, "In this scenario, trustees are not expected to be passive participants in the MF ecosystem. Where there are concerns