UTI SCAM- U.S 64 CRISES

Primary objective and other objective of UTI

SCHEMES of mutual funds in UTI

OPEN ENDED

CLOSE ENDED

US-64 scheme

ESTABLISHMENT

INVESTORS

Fund to Bond to Cash

1964: UTI launches US-64, an open-ended balanced fund

1990-1995: Dividend rate of US-64 is 18%. It rises to 26% by 1995

1995-99: Net asset value of US-64 falls drastically

1999: Deepak Parekh panel set up to suggest US-64 revamp, bailout

2001: UTI suspends sale, purchase of US-64 units for six months

2003: US-64 mutual fund ends; investors offered cash or tax-free tradable

bonds, with 6.75% annual interest

2008: Bonds mature on 31 May, putting an end to the US-64 saga

Year wise information about the process of scam

Reasons behind US-64 crises

Non-declaration of NAV

Declaration of high dividend

Factors helped to rise the US-64 crises

Huge investment in Junk

bonds

Involvement of Ketan

Parekh

Role of Corporate Governance in UTI scams

TRANSPARENCY

ACCOUNTABILITY

INTEGRITY

IMPACT OF UTI SCAM ON INVESTORS

LOSS OF WEALTH

LOSS OF CONFIDENCE

RESULTS IN DECLINE OF

RETAIL PARTICIPATION

SUGGESTION TO PREVENT UTI SCAM IN FUTURE

TRANPARENCY IN THE SYSTEM STRICT LEGISLATION EFFECTIVE AND REGULAR

VIGILANCE HOLE OF MEDIA