Market regulator Sebi on Friday asked mutual funds, portfolio managers and alternative investment funds (AIFs) to disclose the charter of investors and details of complaints they have received.
For mutual funds and portfolio managers, Sebi said they are advised to publish the investor charter on their websites, according to separate circulars.
For AIFs, Sebi said they should bring the investor charter to the attention of investors through a private placement memorandum (PPM) in the case of new schemes and for existing schemes, as a one-time measure, they should disclose it to investors on their registered electronic mail.
In addition, mutual funds are required to publish the details of investor complaints on their respective websites and on the AMFI website on a monthly basis in the prescribed format. Furthermore, mutual funds are advised to display the link/option to file a complaint directly with them on their websites and mobile apps.
In addition, a link to the SCORES website and the link to download the mobile application will also be provided on their website. Portfolio managers are also required to disclose information on their websites on a monthly basis regarding complaints, including SCORES complaints.
The data is to be released by the 7th of next month, Sebi said in separate circulars. In the case of AIFs, they should disclose investor complaint data as a separate chapter in the PPM for new schemes. For existing schemes, such data must be disclosed by means of an update of the PPM within one month of the end of each financial year.
“For effective monitoring, AIFs will maintain records of investor complaints, as collected no later than 7 days after the end of the quarter,” Sebi said. Disclosures must be made in regulatory formats.
The move aims to bring greater transparency to the investor complaint redress mechanism. These disclosure requirements are in addition to those already imposed by Sebi. The circulars will come into effect from 1 January 2022.