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AMFI has asked fund houses not to conduct training programs for MFDs in exotic locations like foreign countries and popular tourist destinations. Instead, AMCs should look at doing such programs in centrally located and logistically convenient locations within the country, said AMFI.
AMFI also clarified that such training programs cannot be done for MFDs based on achievement of sales targets like SIP contest or NFO contest.
The trade body reiterated that AMCs cannot pay any fee or consideration to MFDs other than trail commission that too in monetary terms only. In addition, AMCs cannot offer any gift voucher or electronic gadget to their distribution partners for achieving sales targets.
This has come after SEBI and AMFI reportedly witnessed instances of violation of existing training norms. In fact, the market regulation found instances of a few AMCs funding training programs of MFDs in exotic locations based on achievement of sales target, said a senior MF official requesting anonymity.
Such a norm is applicable for MFDs who run training programs for their employees and sub distributors. However, MFDs with sub broking arms will be exempted from adhering to these guidelines if they conduct training programs on multiple products and services like mutual funds, insurance, NPS, PMS, p2p lending, loan against mutual funds or shares and so on.
