Have you recently received the Investment Adviser licence from SEBI?
I must say, going through the tedious process of continuous follow-ups and submissions to SEBI and finally getting the Investment Adviser licence can feel like an accomplishment in itself.
But now, what next?
I am sure you have heard that there are n number of things to do to have a compliant practice – KYC…. agreement… risk profiling, etc, etc, etc.
But before that, there are other things you have to do which are not mentioned in the regulations but are mentioned in various circulars by SEBI for the intermediaries.
I know it is a tedious job to keep track of these circulars.
To make things easy, I have listed the 5 things RIAs need to do after getting the license:
#1 – Registration with SCORES portal
SCORES (Sebi COmplaints REdressal System) is a platform introduced by SEBI where the investors can lodge complaints online against the registered intermediaries. All RIAs need to have the login credentials for the SCORES portal; also are required to display the link to the SCORES portal on their website and mobile app.
Click here to know the process to get SCORES login credentials.
#2 – Registration with the CKYC Registry
CKYC or Central KYC Registry is a centralized repository of KYC records of customers in the financial sector with uniform KYC norms and inter-usability of the KYC records across the sector.
All the Investment Advisers are required to register with the CKYC Registry to upload, download or view the KYC documents for their clients.
It is mandatory for all the RIA to maintain KYC documents of their clients at all times.
Click here to understand the application process for the CKYC registration.
#3 – Registration with FIU
FIU (Financial Intelligence Unit of India) is an organisation set up by the Government of India for receiving and processing any information about suspected financial transactions.
As a SEBI registered intermediary, you need to get registered with FIU.
Click here to know the registration process with FIU.
Click here to sign up for registration.
Once the registration with FIU is complete, you have to complete the registration for Principal Officer with FIU (whether you are an individual or non-individual entity).
Every reporting entity is required to furnish information about –
- all cash transactions of the value of more than ten lakh rupees or its equivalent in foreign currency
- all series of cash transactions integrally connected to each other which have been individually valued below rupees ten lakh or its equivalent in foreign currency where such series of transactions have taken place within a month and the monthly aggregate exceeds an amount of ten lakh rupees or its equivalent in foreign currency
- all transactions involving receipts by non-profit organizations of value more than rupees ten lakh, or its equivalent in foreign currency
- all cash transactions where forged or counterfeit currency notes or bank notes have been used as genuine or where any forgery of a valuable security or a document has taken place facilitating the transactions
- all suspicious transactions whether or not made in cash
- all cross border wire transfers of the value of more than five lakh rupees or its equivalent in foreign currency where either the origin or destination of fund is in India.
- all purchase and sale by any person of immovable property valued at fifty lakh rupees or more that is registered by the reporting entity, as the case may be.
#4 – Display of investor charter
All registered Investment Advisers are required to display the investor charter on their website and mobile application. The investor charter contains the dos and don’ts for investors while dealing with the intermediaries.
If you do not have a website or your website / mobile application is not live yet, then as a one-time measure, you have to send the Investor Charter to all your clients on their registered e-mail address.
Click here to download the text of the investor charter.
#5 – Display of investor complaints
All the investment Advisers have to display the details of complaints received against them on their website and mobile application. Make sure to update the details every month.
Additionally, you also have to give the link to the SCORES portal. You may also display the link to download the SCORES application.
Again, if you do not have a website or your website / mobile app is not live yet, you have to send the complaint status to the clients on their registered e-mail address on a monthly basis.
Click here to download the format for display of the complaints.
Click here to refer to the circular.
So, these are a few immediate things the IA can do on receipt of the licence. Functioning as a compliant Investment Adviser requires attention to many more aspects of the business.
Click here to know more about the compliance requirements for RIAs.
If you have any queries you can write to me at kruti@cskruti.com