The first lot of Investment Advisers expected to receive their registrations soon, learns Cafemutual.
Many IFAs are initiating the process to register with SEBI as Investment Advisers. IFAs, especially those who run fee based financial planning practice are incorporating changes in their business model to comply with SEBI’s Investment Adviser Regulations.
Prakash Praharaj of Max Secure Financial Planners and member of FPG received a letter from SEBI which stated that he is eligible to be an investment adviser. He has paid Rs 10,000 to register with SEBI and is hoping to get a certificate from SEBI soon. He has adopted a fee-only practice and thus will not be engaged in distribution through another subsidiary or entity.
Similarly, Amit Kukreja of WealthBeing Advisors has also applied for registering as Investment Adviser and is waiting for SEBI’s revert.
Around 15 out of the 30 members of Financial Planners Guild, India (FPG) are in the process of registering with SEBI. FPGI has sought clarity from SEBI on the definition of ‘arm’s length relationship’ and whether distribution services can be carried out through a family member having ARN.
Suresh Sadagopan, President of FPGI has segregated his distribution business by opening another office in a different location. The advisory business will be overseen by him while his father with look after the distribution business. He plans to apply for registration in the category of ‘individuals’ by the end of July.
While some have already filed applications with SEBI, others are in the process of putting in place their systems and processes to be eligible as Investment Advisers.
Mumbai based financial planner Yogendra Joshi and Kerala based Shiney Sebastian are also planning to register with SEBI in two months.
SEBI registered Investment Advisers will have to comply with a host of rules like maintaining client records for five years, risk profiling, copies of agreements with clients, appointment of auditors, among others.
IFAs have to pay a non-refundable amount of Rs 5000 as application fee and Rs 10,000 thereafter for getting Investment Advisor Certification from SEBI. Corporates have to shell out a much higher fee of Rs 1 lakh as registration fee.
Corporate advisers need to have a net worth of Rs 25 lakh while individuals Rs 1 lakh
