A proper redressal system is in place to address the complaints of an MF investor.
Investing in a mutual fund (MF) today is easier than ever before. Now, you could invest not just through the distributor, but also online and without an intermediary. Servicing the MF investor, on the other hand, has always been an issue, though it's being tackled through a series of steps of late. The tardy and unfriendly attitude that characterized the MF industry in its infancy stage has given way to an efficient and personal face. Still, complaints do crop up, such as a missed dividend cheque, issues with a fund's NAV pricing, non-receipt of fact-sheet and annual reports, and so on. If caught on the wrong foot, you can follow the following redressal trail.
The Fund House
Most snags get resolved at the fund house ---- the first step of the redressal ladder --- itself. In case of any clarification or complaint regarding your investment, approach your fund house or its registrar and transfer agent (R&T). Their contact details are there in the account statements or the fact-sheets that funds send to investors. You could also get them from the website of the respective fund house and its transfer agent. The fund house or registrar will look into the complaint and, more often than not, resolve it then and there.
If, for some reason, the investor is not satisfied with the fund house's response and wants further intervention, the next contact should be the regulator -- Securities and Exchange Board of India (Sebi). A written complaint has to be filled with any of the four zonal offices, detailing the circumstances of the case, along with photocopies of the relevant documents. Complaints can also be filled online on Sebi's website www.sebi.gov.in. On receiving the complaint, Sebi will give a reference number, which will need to be quoted in all future communications with it. Sebi will follow up the case with the fund house. If the fund house does not resolve the complaint with three months of filing it with Sebi, you will have to sound out (Send reminder) the regulator again.
If Sebi also fails to resolve a complaint, you will have to approach an investors' association. These are independent entities that help investors in grievance cases. You will have to write to one of the associations, attaching photocopies of relevant documents. Some of these entities provide the services for free, while others charge a nominal fee in the range of 200 - 500 INR. These associations take up individual cases too. To start with, the investors' association will do what Sebi does -- hear the investor's side of the story and follow it up with the fund house concerned. If it does not get a satisfactory answer from the fund house, and it feels there is a case, it might advise the investor to take legal action. It could even help with the case.
Ministry of Corporate Affairs
'Investor Helpline' is a free, dedicated online portal to handle investor grievances administered by different authorities, i.e., the Ministry of Corporate Affairs, Sebi and the Reserve Bank of India, in a focused and sustained manner. It is sponsored by the Investor Education and Protection Fund under the Ministry of Corporate Affairs. Right from filing of the grievances to tracking their status and interaction with the administrator, all the steps have been made online to make it user-friendly.
On rare occasions that your problem remains unresolved, the legal system is your last recourse.