Post Your Complaints On IndianMoney - Mutual Fund Fraud

Mutual Fund Distributors resort to mis-selling and cheat customers to make money. Mutual fund distributors cheat customers by constantly churning portfolios. They encourage you to sell mutual funds at regular intervals and buy new ones to make a profit.

Mutual fund distributors encourage you to invest in New Fund Offers popularly called NFO. For those who don’t know, NFO is the first subscription offered by a mutual fund. They are heavily marketed and mutual fund distributors earn high commissions by encouraging you to avail new fund offers. While NFO may be good, mutual fund distributors sell NFO to customers which don’t meet financial needs. This is cheating and mis-selling.

Post Complaints On IndianMoney If You Are Cheated By Mutual Fund

What are mutual funds?

A mutual fund collects money from you and several investors and invests in equity (stocks), fixed income (debt) and balanced funds (mix of equity and debt), depending on the type of mutual fund scheme. Mutual funds are an excellent way to invest in stocks. You can invest in mutual funds to meet financial goals. A mutual fund appoints a fund manager to manage the money, invest and make profits. First-time investors can save money and time, investing in mutual funds.

Common Mutual Fund frauds and Complaints

• Promising high returns from mutual funds.
• Promising guaranteed returns in mutual funds.
• Concealing material facts on mutual fund schemes.
• Don’t tell about risk in mutual funds.
• If I have complaints mutual fund distributors do not respond.

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Why mutual funds cheat?

Mutual fund distributors act in dual capacity. They do not follow the rules, Keeping at arm’s length. This results in conflict of interest. Mutual fund distributors pretend to represent your or investors needs, but actually represent mutual fund needs. They cheat you by not meeting your financial needs.

Mutual Fund distributors cheat you to earn commissions. Bank executives also mis-sell mutual funds to cheat customers and earn high commission. Mutual funds assign a dedicated marketing manager to banks, who then assist bank relationship managers sell mutual funds. These bank relationship managers mis-sell and cheat innocent customers.

How to register complaint against mutual fund?

• If you have a complaint against a mutual fund distributor, first approach the mutual fund house. Common complains are non-payment of dividends, non-transfer of securities and so on.
• If the mutual fund doesn’t resolve the grievance within requisite time, SEBI has a centralized web based complaints redressal system on its portal called ‘SCORES’.
• SCORES stands for SEBI Complaints Redress System which is an online system to lodge investor complaints against mutual funds.
• SEBI encourages you to lodge complaints online against mutual funds via SCORES and even check the status of complaints.

SEE ALSO:Post complaints on IndianMoney if you are cheated by bank

Register compliant against mutual fund on SCORES

SEBI which is the mutual fund regulator has a website for ‘investor complaints’. You can register a complaint against mutual fund with SEBI through SCORES. Let’s take a look at registering complaint against mutual funds on SCORES.

• You must first Log on to the SCORES Portal.
• You then click on the ‘Complaint Registration’ tab under the ‘Investor Corner’ and fill personal details like Name, Address and Contact Details.
• Fill in the details of the mutual fund you want to complain against. Click on the tabs provided to select the category of complaint. You will have to provide a brief description on the nature of the complaint.
• You will have to supply documentary evidence to support complaint. You may upload a PDF document with size up to 2MB.
• Fill all mandatory fields and submit registration form. Note down the unique registration number when would be generated and displayed on the screen. Preserve this number for future reference.
• SEBI looks into the complaint if it comes under its purview and resolves the complaint in 30 days.
• A SEBI official assigns the complaint to a relevant party which could be a broker, mutual fund distributor, stock exchange or any other SEBI regulated entity. The complaint must be resolved within a fixed time frame.
• SCORES shows the current status of your complaint. Track status of complaint under “View Complaint Status” under investor corner and just enter the unique registration number.
• SEBI officials look into your complaints and make sure they are resolved. Complaints are closed only after SEBI is satisfied, they have been redressed in a proper way.

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How not to be cheated by mutual fund?  

AMFI or the Association of Mutual Funds in India has a website www.amfiindia.com. Visit this website and learn on mutual funds, various mutual fund schemes, types of mutual funds, total expense ratio of mutual funds and management of mutual funds. 

AMFI educates you and other investors on the benefits of investing in mutual funds. AMFI runs the highly successful program, Mutual Funds Sahi Hai, which says you can invest in mutual funds via SIPs with just Rs 500 a month and a lot of other themes.

Educate yourself on mutual funds so that no mutual fund distributor can cheat you. Want to know more on mutual funds? We at IndianMoney.com will make it easy for you. Just give us a missed call on 022 6181 6111 to explore our unique Free Advisory Service. IndianMoney.com is not a seller of any financial products. We only provide FREE financial advice/education to ensure that you are not misguided while buying any kind of financial products.

How to pick the right mutual fund distributor?

• Check qualifications of mutual fund distributors.
• Make sure he’s easily accessible.
• Check track record.
• Make sure he offers comprehensive services.
• Decide on compensation.

Are you cheated by mis-selling? Lodge a complaint on Iamcheated.com which is a free online consumer complaints portal, which registers consumer complaints online and helps resolve them. If you have been cheated by mutual fund or if you do not receive any response from them, you can post your complaint on Indianmoney.com complaints portal IamCheated.com.

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