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## Special Audit Initiated by RBI for IIFL Finance and JM Financial Products

New Delhi: In response to regulatory breaches by IIFL Finance and JM Financial Products (JMFPL), the Reserve Bank of India (RBI) has initiated a special audit process to further investigate their actions. The RBI has taken the step of appointing auditors through the floating of two separate tenders for these non-banking finance companies.

Audit firms that have been empanelled by the Securities and Exchange Board of India (Sebi) for forensic audits are eligible to participate in the tendering process. The deadline for the submission of bids is set for April 8, as outlined in the tender document published by the RBI.

The chosen audit firms will receive their assignments on April 12, 2024, as stated in the bid documents. Earlier this month, the RBI imposed restrictions on both entities due to their failure to comply with regulatory guidelines. IIFL Finance was specifically prohibited from issuing or disbursing gold loans after significant supervisory concerns were identified in its gold loan portfolio.

The RBI conducted an inspection of IIFL Finance with reference to its financial position as of March 31, 2023. Additionally, JM Financial Products faced restrictions from the Reserve Bank due to findings that the company engaged in various manipulative practices, including assisting a specific group of customers in bidding for IPOs using borrowed funds.

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