SEBI meets IFA Associations to discuss commission disclosure rule

Sebi should think about advisor.in my city customer don't no any think about mf we IFA aware to our all customer.

SEBI reconsider of disclosure of commission in account statement.
SAVE IFA ,SAVE INVESTOR.

Good effort !

Highest paid commission is from LIfe Insurances. If IRDA proceeds, AMFI should think about it . Why MF advisors are to be butchered only.

There should be stop on direct selling or accepting investment by the AMC, as it is itself is a moral breach of ethical conducts and this makes ethical, prudence status of the AMC as being trust fund. what disclosure of commission shall actually bring to this industry will it increase the investor return??

Hope this meeting is followed by SEBI's required action (with wisdom).

what about lic? post office agents?

Very nice sebi should take action about this

IFA's are presently only surviving , in some months office expenses are too not recovered from commisions and if this as SEBI says investors will demand passback as is the case in LIC and other insurance policies . Good effort by Cafemutual.

Dear Sir

It is to bring to your notice about ridiculous, maligned and one sided circular being issued by market regulator SEBI to disclose mutual fund distributor’s commission in client statements going forward.

Currently, mutual fund distributors are already giving an annual disclosure to AMFI which states that we are disclosing commissions to investors.

Despite AMFI’s (industry and AMC body) plea to not go ahead with commission disclosure rule in account statements, SEBI has instructed AMCs to disclose commissions in half-yearly account statements.

The following points have come up for notice and review after this circular being passed:

1) Has SEBI received complaints from customers in regard of non-disclosure of commissions by distributors or of mis-selling of products? If not, why the need for senseless circulars? And if yes, then why not punish the culprits rather than destroy the whole IFA community. Are these complaints largely directed against a set of distributors like banks whose all employees are given targets to sell without having any knowledge or formal training.

2) Giving too much information to investors will only confuse them and resist them to take up services of MF distributors wherein they are guided and educated by our community to invest in mutual funds, provide consultancy services of picking up right funds depending on clients investment portfolio, past experience, income profile, life stage, risk profile, investment horizon, doing portfolio review and rebalancing, guiding the client in difficult times etc. Does SEBI think that such services are free in nature and IFA as a community should not be there in the first place? Let them reply in plain terms if distributors are required or not in the industry.

3) The move will be inducing pass back culture which only established distributors and big banks can afford.

4) No more new distributors to join the industry. What happened to the idea of Skill India? What happened to idea of self sustainable employment generation for educated youth in India? Are we happy with less than 10000 active distributors in a country of more than 125 crore people? How does SEBI encourage new and professionally educated persons to join the industry?

5) Why doesn’t SEBI make it mandatory to disclose commissions across products like structured products, PMS (upto 4-6%), private equity (up to 4-6%), insurance plans (up to 50%) and NCDs (up to 6%) to disclose their commissions? Only mutual funds have been wealth creators among these ridiculously expensive products. All other products have proven to be wealth destructors. Why the regulators are biased against the Mutual Funds distributors only. Also, all industry depends on commissions to selling agents, even a bottle of shampoo sold in India, commissions are paid to distributors and retailers. Do they disclose their commissions in the bill provided to clients. Then why such disclosure on mutual fund commissions? Smells of rat.


6) There is already a provision of Direct Mutual Funds Plans in all categories for educated and well heeled investors who have high financial literacy and do not wish to take services of a distributor. Also, distributor’s income and commissions are capped through various provisions including maximum expense ratio of fund, capping on upfront commission etc. Then what is the purpose of such a disclosure to investors who have been educated and served over the years by distributors. Does the regulator considers distributors to be only taking up the service of educating and bringing new clients to the industry only to be grabbed up by direct plans lure in future. How does the regulator ensure continued income to distributors for their efforts to educate and bring the clients to the mutual fund industry?

7) The angle of corruption in SEBI board and officials is to be also checked. Its highly likely that the SEBI board, officials and chairman are bribed by big banks and AMC’s who want to get rid of the distributors which are their direct competition. That way they will start enjoying monopoly in mutual fund distribution in India. All at the expense of the investors and IFA distributor community. Assets and liabilities of all SEBI officials, board members and chairman should be scrutinized by IB and concerned authorities.

SEBI as an industry regulator is acting with malaise and partiality against the distributor community on the behest of the large corporate distributors and banks who have bribed most of the SEBI board officials to come up with new and ridiculous methods to discourage and destroy the IFA channel in India.

We request you sir to look into the issue seriously and have all angles of SEBI circular being checked. We demand that this SEBI circular on commission disclosure be rolled back asap and no one should be allowed to destroy a budding industry and take away hard earned income of hard working people of India and also not to create disruptions in the market place in the name of investor protection. Checks and controls should be put in place so that no one is intentionally benefitted by regulator acting with malaise.


I have written the above letter to the Prime Minister and President of India online grievance mechanism. All IFA can copy / change language as they deem fit and proper and write to the PM and President.
10 mins task.
Pls do not hesitate.
Let 1000 complaints reach the office of the PM and President and they force SEBI to withdraw this circular.
Websites are as below. Convert to PDF online and then attach as PDF online.
pgportal.gov.in- PM office portal
helpline.rb.nic.in - presidents office helpline

Good initiative.
What was the response of SEBI? Did they agree at least to consider the request?
Practice followed by many other regulators in other sectors:
1. Notify the new proposal/iniative if any
2. Obtain written opinions/suggestions of stake holders and general public within a prescribed time frame.
3. Study all such openions and suggestions
4. Conduct a siting to hear the opinions and
5. Decide on the subject based on the merits and demerits of all
Why not our Associations also request SEBI and to follow this procedure in the case of disclosure of brokerage paid to distributors, salaries of Officials of AMCs, etc