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Investment Managment SEBI
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- 3. SEBI {Securities & ExchangeBoard of India}
- 4. ESTABLISHMENT OF SEBI: ü SEBIwas established in 1988 by the Government of India. ü Statutory powers was given on 30th January 1992 through the SEBI Act, 1992. ü SEBI has its headquarters at the business district of Bandra Kurla Complex in Mumbai and may establish offices at other places in India.
- 5. SALIENT FEATURES ü Itshall be a body corporate with perpetual succession an common seal with power to acquire hold and dispose off properly. ü Chairman and members of board are appointed by the central government. ü Government can prescribe terms of office and other conditions of service of the board and chairman. ü Primary duty of the board is to protect the interest of the investors.
- 6. OBJECTIVES SEBI acts asa watchdog for all the capital market participants. The main purpose is to provide such an environment for the financial market enthusiasts that facilitate efficient and smooth working of the securities market. SEBI makes sure that they get a healthy and transparent environment for their needs.
- 7. Contd. SEBI is responsiblefor maintaining an environment that is free from malpractices to restore the confidence of general public who invest their hard earned money in the markets. They make the financial transactions smooth and safe.
- 8. ORGANISATIONAL STRUCTURE The SEBI Board consistof nine members- One Chairman appointed by the Government of India Two members who are officers from Union Finance Ministry One member from Reserve Bank of India Five members appointed by the Union Government of India
- 10. POWER OF SEBI: ITHAS POWER TO IMPOSE MONETARY PENALTIES. IT HAS POWER TO INITIATE ACTIONS IN FUNCTIONS ASSIGNED. IT HAS POWER TO REGULATE INSIDER TRADING. IT HAS POWER TO REGULATE BUSINESS OF STOCK EXCHANGES. IT HAS THE POWER TO ASK INFORMATION FROM THE STOCK EXCHANGES AND INTERMEDIARIES REGARDING THEIR BUSINESS TRANS ACTIONS FOR INSPECTION OR SCRUTINY AND OTHER PURPOSE.
- 11. Functions of SEBI SEBI primarilyhas three functions- Protective Function Regulatory Function Development Function
- 12. PROTECTIVE FUNCTION ü SEBI toprotect the interest of investors and other financial participants. ü It includes- • Checking price rigging • Prevent insider trading • Promote fair practices • Create awareness among investors • Prohibit fraudulent and unfair trade practices
- 13. REGULATORY FUNCTION ü They areperformed to keep a check on the functioning of the business in the financial markets. ü These functions include- • Regulation of takeover of companies • Conducting inquiries and audit of exchanges • Registration of brokers, sub- brokers, merchant bankers etc. • Levying of fees • Register and regulate credit rating agency
- 14. DEVELOPMENT FUNCTION ü Imparting trainingto intermediaries ü Promotion of fair trading and reduction of malpractices ü Carry out research work ü Encouraging self-regulating organizations ü Buy-sell mutual funds directly from AMC through a broker
- 16. IEPF- INTRODUCTION Investor Education andProtection Fund (IEPF) has been set-up under Section 205C of the Companies Act, 1956 by way of the Companies (Amendment) Act, 1999
- 17. The following arethe members of the Committee on IEPF, which has been constituted for a period of 2 years: • Secretary, Ministry of Corporate Affairs (MCA) - Chairman • Addl. Secretary/Jt. Secretary and Financial Advisor, MCA - Member • Executive Director, Reserve Bank of India, Mumbai - Member • Executive Director, SEBI, Mumbai - Member • Ravi Narain, Managing Director, National Stock Exchange -Member • Manu Chadha, Chartered Accountant (CA) - Member • Nesar Ahmed, Company Secretary (CS) - Member • P. Vaidyanathan, Investor Activist (Chennai) - Member • Vinod Kothari, CA&CS, Kolkata - Member • K.K Gupta, IRTS (Retd.) - Member • Avinash K. Srivastava, Joint Secretary, MCA - Convenor
- 18. Things to knowabout IEPF The IEPF fund has been set up under the Ministry of Corporate Affairs for promotion of investor awareness and protection of investor interests Unclaimed dividend, refund of application money, matured company deposits and debentures, and interest on them are moved to the IEPF fund if not claimed within seven years. The IEPF is monitored by a trust, which decides how the money will be utilized for specific activities of investor awareness and education
- 19. Contd… • Once theamount is credited to the IEPF fund, an investor can’t recover the unclaimed amount. However, he can view the amount credited to the fund on the IEPF website. • Investors can claim unpaid amounts from the company before they are credited to the IEPF account by following the procedure prescribed by the company
- 20. IEPF • Investor educationand protection fund or IEPF is a fund set up under the Section 205C of the Companies Act, 1956 • To pool all the dividends of the Asset Management Companies, matured deposits, share application interests or money, debentures, interests, etc. that are unclaimed for seven years. • All the money collected from the mentioned sources has to be transferred to IEPF. • Investors, who are trying to seek a refund for their unclaimed rewards can now do so from the Investor Protection and Education Fund (IEPF). • The fund has been set up under the guidance of SEBI and Ministry of Corporate Affairs India.
- 21. REASON FOR IEPF •the Ministry of Corporate Affairs was responsible for setting up of IEPF. • But, in 2016, the Ministry of Corporate Affairs notified IEPF to allow investors to seek a refund on their unclaimed rewards. • For claiming such amount, they have to fill the IEPF-5 along with the required documents of the website of the IEPF.
- 22. OBJECTIVES OF IEPF •Educating investors about how the market operates. • Making investors educated enough so that they can analyze and take informed decisions. • Educating investors about the volatility of the markets. • Making investors realize their rights and various laws about Investing. • Promoting research and surveys to spread knowledge among the investors.
- 23. • The Secretary,Ministry of Corporate Affairs is the Chairman of the Committee.. • Injeti Srinivas, Secretary, Ministry of Corporate Affairs (MCA) • The members are representatives of Reserve Bank of India, Securities Exchange Board of India and experts from the field of investors’ education and protection.
- 24. The following amountsshall be part of IEPF, if they remain unpaid for a period of seven years from the date of declaration amounts in the unpaid dividend accounts of companies; the application moneys received by companies for allotment of any securities and due for refund; matured deposits with companies; matured debentures with companies the interest accrued on the amounts referred to in clauses (a) to (d); grants and donations given to the Fund by the Central Government, State Governments, companies or any other institutions for the purposes of the Fund; and the interest or other income received out of the investments made from the Fund.
- 25. Function of the committee •To recommend the Investor Education and Protection activities like seminars, symposium, proposal for registration of voluntary association or institution engaged in Investor Education and Protection projects. • Proposals for registration of Voluntary Associations or Institution or other Organizations engaged in Investor Education and Protection activities; • Proposals for projects for Investors’ Education and Protection including research activities and proposals for financing such projects; • Co-ordination with institution engaged in Investor Education and awareness and profession activities. • To appoint one or more sub committee for functioning of fund in good manner • To furnish report to central government at end of each six months.