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‘Investment advisors must be regulated’

Proposed regulation of investment advisors will benefit the industry once enforced,Sebi official said.

Written by Agencies | Mumbai | Published: May 4, 2012 7:44:09 pm

The proposed regulation of investment advisors will benefit the industry once enforced,a senior Sebi official said here today.

“Once the regulation of investment advisors comes into effect,the industry will benefit,” Securities and Exchange Board (SEBI) deputy general manager Maninder Cheema said while addressing a seminar on ‘Future of career in financial planning,’ organised by the Financial Planning Standards Board here.

In a move aimed at addressing conflicts of interest in distribution of financial products,the Sebi had issued a concept paper to regulate investment advisors last September.

The capital markets regulator intends to keep a check on investment advisors through the self-regulatory organisation (SRO) route.

The proposed regulatory framework is on the activity of providing investment advisory services in general,not limited to securities,insurance and pension funds.

Addressing the meeting,Reserve Bank General Manager DG Kale said,”While the regulators take care of three ‘I’s (instruments,infrastructure and investors) the fourth ‘I’ (individuals) needs to be addressed by professional financial planning bodies such as the FPSB promoting CFP certification,in terms of building the right knowledge base for ensuring that investors meet their needs in a holistic and ethical manner.”

FPSB India vice-chairman Ranjeet S Mudholkar said,”Financial planning profession has gained credence to be recognised as a distinct profession across the world in the personal finance domain,and CFP certification is now widely accepted as the global mark of excellence in financial planning. We now need a more collaborative effort amongst all stakeholders to take forward the financial planning movement ahead in the country.”

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