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SEBI has asked RIAs to prominently display standard disclaimer that they cannot provide return assurance to investors across all forms of communication.
SEBI said RIAs have to put a disclaimer in their website, advertisement, marketing material, KYC form, report, statement and all other correspondence saying registration granted by SEBI, membership of BASL (in case of IAs) and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.
Further, SEBI clarified that RIAs will have to mention the name through which they have obtained RIA license with SEBI along with their brand name. For instance, ET Money will have to mention that they Banyantree Services in all their communication.
Sharing the rationale behind issuing these guidelines, the regulator said, “It is observed that few investment advisers and research analysts are using the brand name/trade name/logo more prominently in their advertisements, websites, publications, correspondences with clients and various documents while marketing their services rather than their name as registered with SEBI.”
It added, “The brand name/trade name/logo may or may not be related to the name of IA/RA as registered with SEBI and hence may mislead and create confusion in the minds of the investors.”
Further, SEBI said that RIAs will also have to display the name as registered with SEBI, logo, registration number and complete address with telephone numbers on statements or reports or any other form of correspondence with the client. They should also carry the name, telephone number and e-mail address of the compliance officer and the grievance officer or the grievance redressal cell.
The market regulator has also clarified that RIAs cannot use SEBI logo.
