Mutual Funds Framework Violated, SEBI sends letter to AMFI

In a letter to the Association of Mutual Funds in India (AMFI), the Securities and Exchange Board of India (SEBI) has reportedly raised questions concerning 23 practices for breaching the mutual fund regulations.

The regulator’s inspection team reviewed various practices during the period 1 April 2016 to 31 March 2017. The team found over 23 exercises that violated or was non-compliant with the regulator’s existing framework.

Some of the practices that SEBI pointed out in the letter included investors’ interests being dishonoured by providing false reports on investor complaints. The inspected team also observed instances where the funds allocated for investor education was being utilised inappropriately.

Also Read: Mutual Funds’ exposure to Nifty touches decade high

SEBI’s primary objective is to safeguard investors’ interests while preventing malpractices in the investment market.

The inter-scheme transfers, monitored by the regulator, have also been utilised by some MFs for debt securities’. In a letter addressed to AMFI, SEBI warned MFs of action if corrective measures are not taken concerning the observations made by the regulator’s inspection team.

The letter also mentioned practices where AMFI-suspended distributors were continuing business with Asses Management Companies (AMCs). Furthermore, some AMCs had also failed to stop paying commission to the suspended distributors.

You May Also Like
Gold Jewellery

24K Gold Rate in India for October 2019: Week 3

The week commenced with the gold rate in India holding at Rs.38,300…

Is income tax applicable on Bonus Income?

Did you know that tax deductions don’t apply for the incentives and…

24K Gold Rate in India for July 2019: Week 5 (29 – 31)

Trading commenced for the final week with gold price in India holding…
Gold rate

24K Gold Rate in India for February 2020: Week 4

When trading opened for the week, 24K gold rate in India was…