Withheld commission issue: AMFI lists out action plan to update PAN/KYC

Dear IFA Friends, whoever was in Upfront plus Trial Model earlier to Nov 2018,i request you to check all your brokerages as I have identified few mistakes...specifically Karvy AMC's. Check Whether trial is paid for all transactions( I found out few folios are missing, missed almost 38 transactions for each folio), No B30 is paid after Jan 2019 for SIP transactions in few folios, fresh SIP instalments are paid old trial brokerage for few folios.

This could & should have been done from day one when this requirement was declared. Investment done without PAN was as per the rules applicable at the time of investment. Punishing IFAs for doing nothing wrong is a bad practice.

Investments made prior to PAN mandatory is very difficult to get KYC details due to non availability of the investors due to transfer / shifted . We are in precarious situation and we lost heavily our brokerage . We request SEBI to reconsider our trial Brokerage should not be affected.

Implementing any directives on retrospective basis is a challenge. A directive to update pan/KYC even for redemption could be considered rather than going for a wild goose chase...

Implementing any directives on retrospective basis is a challenge. A directive to update pan/KYC even for redemption could be considered rather than going for a wild goose chase...

Investments made prior to PAN mandatory is very difficult to get KYC details due to non availability of the investors due to transfer / shifted . We are in precarious situation and we lost heavily our brokerage . We request SEBI to reconsider our trial Brokerage should not be affected.

Do not allow invest to redeem units until completion of KYC.

If not completed the process within the said date ,. What will happen , distributor not getting commission as per SEBI guidelines , and not cleared about the TER ,,,

What about micro SIP. This was done without PAN and we had assured PAN will not be demanded. The very purpose micro SIP will be in jeopardy.

Mapping of non compliance data with available data was already suggested in my previous feedback in one of your article on commission withheld of distributor.
Having said this, said exercise from amcs as well as RTA side if done earlier when very 1st circular had came out then today it had become much simpler and no so much hay why.

Another thing as mentioned in your article as of today I as a distributor has not received any communication either from amcs or from registrar for such kyc update required folio details.

In fact the data received from some of the amcs and registrar's mail back service doesn't match with each other! And in some cases even everything is found available in SOA still it is reflecting in commission withheld data. Also in many reports I have found irrelevant data in that excel sheet for kyc held report like date of purchase, time of transaction, amount of transaction, etc., But that report does not give us name of holders and missing information details for kyc. Infact the report can be as simple as only 4 data points, namely folio number, joint holders details, missing information, and action and procedure to complete the same. According to me rest of the information are not required.

Another thing I have noticed that even person whose kyc compliance status was available properly but if that person had been deceased and reported from any of the system in kyc portal then it becomes showing kyc not o.k. and on hold, so irrespective of that deceased person holding position i.e. as a 1st holder or joint holder, the whole folio gets affected and comes under kyc on hold data, which is not fair. How a distributor will be liable for that status update with amcs? It is investor's duty to inform them. What does authority do when such deceased investors are in direct mode? Will they stop charging expense ratio and also withheld salary of staffs looking after such folios of that amcs and registrar?
It is also seen that communication of kyc updating letters were sent in last week of April only for nds and big broking house investors list and distributors having big aums but not for small distributors and I am not giving this statement just for sake but on the basis of practical experience.

Alao one more thing I have noticed that if you have generated such kyc on hold transactions as a sub broker in past, some of the amcs don't cooperate and refuse to give latest SOA and other such information inspire you are giving your confirmation date being a subroker there and also providing letter of authority from client. They just simply refuses in the name of confidential data and says they can share such information only to the arn reflecting there and to investors. So even if we want to service and update the required details how we can, in absence of information and non cooperation?!

Will Cafe Mutual forward this issues to concerned authorities and tell them to listen to above issues faced by distributors and give solution to that and justification and give permission for not to withheld our commission in such cases?

Piyush Shah

This shows how company biased regulator really is. Of KYC is incomplete AMCs charge full TER and keep it, registrar charged and kept the full charges and in fact AMCs will keep entire TER if distributors fail to do KYC of any folio. So in the whole exercise only distributor looses whereas AMCs and Registrars gain. Why should AMC be allowed to charge TER on non KYC complaint folios?

1) Distributor is not responsible for PAN & KYC Updation of business prior to Compliance requirement started 2) If Regulator wants it, they should communicate thru Print and Electronic Media for awareness of investors with the help of AMFI 3) Folios should not be allowed for further transaction, if PAN and KYC not updated. If Regulator wanted full compliance, they would have done it as a first step only instead of holding brokerage
4) Holding Brokerage is foolishness and absurd and biased action 5) If Brokerages are held up, why can't AMC Fees on such folios. Again a Clear cut Bias. We Poor Distributors, facing gross injustice.

There is Main problem to update KYC of NRI clients.
When NRI clients will come to Visit India , only then IFA can submit new KYC for them.
So AMFI should give relief for NRI clients & do not stop commission for NRI folios

My dear friends,

Keep in blaming Is not good practice.

We need to understand the concept behind the new rules.

This is new India where has trying to pull out from the black money, un ethical money laundering activity.

We as being a responsible we need to support this kind of activity in a peaceful manner...

Don’t look every thing in a Commission prospective.

Lates take an example A

Mr A invested in AMC long back got transfer to some other place. After some days something bad happened to his life.

Now he neither informed his family about his investment nor the Advisor know about the death..

So what will happened with his investment....

So please take this opportunity and meet your investors and collect as much as possible.

Example B

Some investors done micro investment long back and we also forgot that investor... because of his low investment. After some days customer applied for pan and having it but he didn’t informed us..

Now the time as come to convert that Micro investors to Macro Investors...

Please do smart work......

I am with SHIVA Shankara S N. My points are same.

Even as of Today MCS and Registrars has not mapped up kyc data as mentioned in above article, nor they are able to give us true & correct data, amcs are saying approach RTA & RTA are saying approach amcs. Not a single letter or email is received from concerned parties to me for such kyc or pan missing in folio to be updated, unless I have asked for. Infact in some of the case even the required details are provided, it is still not reflecting and my commission is not paid. infact latest report shows my unpaid commission is more then the paid one.