SEBI Asks Mutual Funds To Stop Misleading Illustrations
SEBI has asked mutual funds not to advertise fake claims like assured returns, and misleading advertisements and to comply with the advertisement code. The Securities and Exchange Board of India (Sebi) has ordered mutual fund companies to stop using deceptive advertising, brochures, and presentations, claiming that the visuals used in these materials give the impression that investors will receive fixed returns on their investments. It has come to our attention that some Asset Management Companies are engaging in advertising practices that do not follow the Advertisement Code as set forth in the SEBI (Mutual Funds) Regulations, 1996, in both letter and spirit “said Sebi. According to the regulator, there have been instances where MFs have distributed pamphlets and brochures that show future returns based on projections and assumptions. Additionally, it stated that investors are likely to overlook disclaimers and assumptions that are in the fine print. According to the Sixth...