AMFFA Kanpur and other IFAs from Kanpur posted hundreds of Letters seeking the intervention of PM and finance minister in th issue. Thanks to Mr. Dhurva Mehta & others for having discussed the matter with SEBI.

Aprox 200 letters has been posted to PM, FM and Sebi from the IFas of Kanpur. in connection to disclosure of commission. Also AMFFA also posted letters to FM, Sebi Chairman stating plight of Distributor and suggestions. Thanks

I endorse the authors view. i got presentation of other associations which they have presented or planning to present. These all are against the distributors interest.In my opinion our case will be based on financial inclusion and increase of retail participation only.nothing else. yes it is a good point of channel bias. we are working on it. will come out with inclusive...

VERY WELL ARTICLE.

Wellargued.

SEBI has been talking about cost cutting and transparency from day one now sebi is planning to deploy celebrity for the promotion of mutual fund industry and expenses will be paid from investor education money fund which is again taken out from investors pocket.

1)"A better way forward on commission disclosures" : Dear Vijay , can you show me the record of the number of complaints that you have filed , when ever you have come across a overflowing drainage in your city.Probably none.Now, please do not conclude that the drains in in your neighborhood never over flow! So this no of complaints thing wont work , even if there is one , the core issue needs to be addressed.2)Channel bias : This is a point to recon, why shall a regular sales guy need to campaign the direct class?Before this the important question is that why is the expense ratio of all other services ( keeping the advisor fee aside) not uniform for direct and regular. In other words ,the AMC shall have no benefit of selling the direct , giving discount from the regular.Once this segregation of advisory fee from the overall TRE is done , the conflict naturally gets removed.3)Legal course against SEBI is a ridiculous idea, one shall only count on representations to SEBI.

Thanks Vijay. There cannot be better approach then what you have suggested. Can you put some light on legal options too. Regards

WELL. SEE EVEN NOW PEOPLE ARE NOT IN REALITY AND MANY ISSUES ARE BEING NOT COSTED IN THE DIRECT PLAN. SERVICE TAX IS BEING TAXED TO THE DISTRIBUTOR & NOT TO THE INVESTOR. MEANS ONLY AN INVESTOR WHO IS INVESTING THROUGH DISTRIBUTOR IS BEING COSTED INDIRECTLY(EVEN THOUGH PAID FROM THE DISTRIBUTOR BROKERAGE) & NOT THE DIRECT CUSTOMER. SO THE DIRECT CUSTOMER IS ENJOYING THIS BENEFIT. I HAVE EVEN WRITTEN REGARDING THIS TO THE FINANCE MINISTER TO MR. ARUN JAITELY IN THIS REGARD. SO FRIENDS PLEASE CALCULATE WELL THE NAV FOR THE DIRECT INVESTOR& SHOW THE MINISTRY &DEPARTMENTS. HOW MUCH OF SERVICE TAX IS BEING LOSSED BY THE GOVT BECAUSE OF THE DIRECT PLAN. OTHERWISE ASK THE MINISTRY TO CHARGE THE SERVICE TAX ON THE AMC FEE OR MAINTAINANCE FEE COLLECTED OR CHARGED TO THE SCHEME AND NOT TO THE DISTRIBUTORS THEN ONLY THE DIRECT INVESTOR IS ALSO CHARGED OTHERWISE NOT. HOPE FOR THE CHANGE TOWARDS GOOD FOR ALL. JAI SRI RAM.

All A M C should support IFA community with out hurting the profession. Individual distributors should not suffer by enfor ceing by new regulation.

We should file application under RTI to all amc to ask what they have given their feedback & views about the recent SEBI circular. So we can understand which AMC favors distributor & against the distributor

Very well articulated. May be as a proactive manner you yourself can reach out to all our IFA associations and make these suggestions. Best wishes & regards,

Thanks Vijay. All your points are very valid. Thanks for bringing our attention to the fact of "Channel Bias" by the Regulator. It is quite evident that the "Bias" prevail and IFA Fraternity feels that it is being done deliberately. Your Forum should invite AMCs views on this.

Dear Sir I have a totally different perspective. I could be introduced to Mutual funds at the age of 36 only but was introduced to Insurance at the age of 21 . Now who is going to reimburse me for the huge opportunity loss suffered by me during this 15 year period from age 21 to age 36 as i was approached for Insurance but not for Mutual Funds. Now Insurance Returns are sub 6% & Mutual fund returns are 12% plus on even balanced funds . So now the regulator is saying either the Investors should get full 12% ( not 11% because of Distributor exp for Example) or they should remain stuck with these sub 6% products or with chit fund companies then that is so ridicules.

All IFA associations across India should work unitedly and take up the matter pro-actively . Its a now or never opportunity to work with regulator and his regulations to prove him what is right. Voice can become strong once they are consolidated at local levels. Its high time for all the members of all the associations to touch base with their associations and extend their best support /demand to fight it out with great spirit to join at the national level.

Vijay , I agree with your observations however the lead has to be taken by AMFI and AMC CEOs , to take up the issues relating disclosure of AMC remuneration and Commission Disclosure and on Channel Conflict. Mr SM Dutta at FIFA annual conference advised that the industry has to go with one voice. Also distribution is but an extended arm of AMC . We hope that promoters/sponsors and Indias financial icons take personal initiative to improve the environment for a massive growth of th MF industry which will enable retail households to participate in the India Growth story It would be nice if you could carry views of leading AMCs also

appreciable decision should also involve MOS of finance Mr. Jayanth Sinha for his pragmatic approach to the problems being faced by IFA vs regulator. Ifa should treated as another set of employment generation with guidelines and respecting the laws of taxation, rather than decimating the whole structure as is being done with the present regulator. the IFA fraternity is honouring the compilation of all the rules and stipulations imposed since times. while every sector is seeing improving the financial security with return of inflation here is the regulator destroying the fabric of ifa reasons best known.-sadbhavana

Totally agree with everything that has been articulated, specially the point about channel bias. In this regard I would like to add another aspect. The cost of running and having several offices by AMCs should be borne by the direct plan. We advisors have no need for these offices since we can get all the services from the registrars, CAMS & Karvy. Offices of AMCs just act as forwarding offices as far as advisors are concerned. The only purpose these offices serve is to provide assistance to direct investors. I wonder how this expense is allocated between regular and direct plans. What proportion of advertising expenses are allocated to direct plans? Maybe there should be disclosures on this too.