Indian couple in Norway convicted; father gets 18 months, mother 15

Chandrasekhar Vallabhaneni and his wife Anupama were convicted for child abuse and sentenced 18 and 15-months jail term, respectively 

 
Oslo: The Indian couple facing criminal charges of child abuse were convicted on Tuesday by a district court here with the father getting an 18-month jail term and mother being sentenced to 15 months, reports PTI. 
 
Chandrasekhar Vallabhaneni, a software professional from Andhra Pradesh, and his wife Anupama, who were arrested by the police in November, were convicted for gross or repeated maltreatment of their child/children by threats, violence or other wrong.
 
The prosecution had proposed a sentence of 18 months for the father and 15 months for the mother in the case which was upheld by the Court.
 
Reacting to the Court verdict, Indian officials in the Ministry of External Affairs said, “Our embassy in Norway has been in touch with the Indian nationals involved in the case. Even during the course of their detention the Consular Officer has been in touch with them. We will continue to render necessary consular assistance and will be in touch with their lawyer.”
 
Justifying the arrest and charges, Kurt Lir, Head of Prosecution, Oslo Police Department, had said that “there were burn marks and scars on the body of the child, who has also been beaten by the belt.”
 

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Are some fund houses taking advantage of SEBI’s sloppiness to pick investors’ pockets?

Some funds are re-routing applications of the top 15 cities through other cities to claim the additional expense ratio at the expense of investors. This is exactly what we had suggested would happen in a Moneylife seminar on mutual funds recently

Fund houses are allowed to charge an additional total expense ratio (TER) of up to 30 basis points (bps) based on inflows from beyond 15 cities, as per regulations of the Securities and Exchange Board of India (SEBI). According to The Economic Times, mutual fund companies are said to be directing applications from top 15 cities through other cities to show a higher inflow from beyond the top 15 cities to grab the extra expense. Such malpractices were bound to happen. An unaccountable and lackadaisical SEBI has a left a huge gap in regulations which is being exploited by fund houses. In a special seminar on the new rules conducted by Moneylife Foundation on 26 September  (Read: Mutual Funds Seminar: How will SEBI's new rules affect your investment?), Debashis Basu, editor and publisher of Moneylife magazine, brought up this fact and had forecast that fund houses would find a way of earning this additional fee, considering that major inflows come from the top 15 cities. As per the latest AMFI report, as much as 87% of the assets managed by mutual funds come from the top 15 cities. Before this regulation came in force from 1 October, we had mentioned that the calculation is complicated and there is low accountability. (Read: Mutual funds to be expensive from 1st October)

 

Moneylife contacted the Association of Mutual Funds in India (AMFI) to seek a clarification on the calculation for the additional expense ratio, whether it would be done on the basis of the address in the KYC documents or on the basis of from where the application has been filed. AMFI refused to divulge any information on this. However, according to a source from the fund industry, there is no clarity on the calculation for the additional TER. Up to 31 March 2013, additional TER charged would be based on the inflow from the respective city and post that it is likely to be based on the pin-code of the address mentioned in the KYC document. However, no official confirmation has been received, said the industry source. Till then it is likely that fund houses looking to gain that additional fee would re-route applications of top 15 cities through other smaller towns and cities and take advantage of the huge loophole left by unaccountable and lackadaisical SEBI officials.
 

  1. But still, this is just the first part of the clause to increase penetration beyond the top 15 cities. The second part states that the claw-back of additional TER charged, if the inflow from beyond 15 cities is redeemed within a period of one year from the date of investment. However, at present, there is no clarity if there are any checks for the same. The regulator’s move in order to ‘benefit’ the industry without any accountability seems to benefit just the asset management companies.

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COMMENTS

Nilesh KAMERKAR

4 years ago

It is simple, if the address of the first applicant as per the KYC is from one of the top 15 centers, then it is an investment from one of the top 15 centers.

If such application is shown as application from a tier2 city then it must be deemed as violation of SEBI’s MF regulations and must attract penalty accordingly.

A better way could be to periodically review the effectiveness of the new measures issued by SEBI to revive MFs. If any of these measures are abused or found to be ineffective, there’s nothing that stops the Regulator from refining or redefining such measures.

Also, SEBI can always roll back the 30 bps additional TER.

Suiketu Shah

4 years ago

this is another reason why its best to avoid mutual funds.Go for FD's or if you have a risk appetite longterm shares like HDFC ltd,RIL,HDFC Bank,TCS,IDFC,etc.

The mutual funds industry is dying due to unscrupulous tactics of fund houses and agents.

REPLY

Nilesh KAMERKAR

In Reply to Suiketu Shah 4 years ago

Suiketu,

Bad behavior must never escape punishment. This serves as a deterrent for others who may be tempted.

Also am curious to know what is your profession or business?

DEEPAK KHEMANI

4 years ago

Similar reports have come in print media but reports like this are are vague isn't it?
The errant AMC's/MF's should be named otherwise every AMC/Fund house is now suspect!

REPLY

pravsemilo

In Reply to DEEPAK KHEMANI 4 years ago

Hi Deepak,

I wouldn't be surprised if Franklin Templeton is not among the list. I have been tracking expense ratios of various mutual funds since some time. Franklin Templeton is one of the first fund house to increase the expense ratio for all its funds. In some cases they have increased the expense ratio by more than 30 bps. And I am not talking about some obscure fund, but some of their well established funds.

You can refer to Morningstar website which as of now is showing the older expense ratio and compare that with the expense ratio in the FT website. You will notice a 30 bps difference.

What sursprises me the most is that are inflows to FT so large that right from October they could change the expense ratio? They haven't disclosed AUM by geography in their website since September 2012. And even for September 2012, their inflows from Top 15 cities are 83%. I wonder how they have charged the extra expense ratio.

I am not sure which other AMC are also doing this as there is very less (reliable) public data on expense ratio.

pravsemilo

In Reply to pravsemilo 4 years ago

CORRECTION - Actually September 2012 has to be read as September 2011. The latest data on their site is for June 2012, which is however almost same as September 2011's data.

Also to mention that AMFI's website shows that almost 85% of inflows are from top 15 cities. Individually all the AMCs have a ratio in the same range. I wonder how do AMCs are able to charge extra 30 bps.

Majority of mutual fund managers surveyed expect the Sensex go above 21,000 after one year

Mutual Fund managers have a positive outlook towards equity market in the short-term and expect earnings growth to improve next year

 
Even though half the mutual fund mangers feel that the equity markets are undervalued and the remaining feel that the market is fairly valued, more than half of them expect the market to be up between 15%-20% after one year, according to the latest “Fund Managers Survey” by ICICI Securities. Most of the fund managers are positive on the market from a one year perspective, says the report. However, do not take the report as an industry consensus as just 12 fund managers have taken the survey. Out of the 12 managers surveyed, three feel that the Sensex would be in a range of 10%-15% after a year and two fund managers feel that the Sensex will deliver a return below 10%.
 
When asked for their outlook on the markets in the next three months, majority were bullish, whereas the rest have a neutral outlook. However, in August 2012, before any reforms were announced, just 8% were bullish of the market. The Sensex is up 9% since. The survey in August 2012 showed that majority of the fund managers felt that the market was fairly valued. However, as per the current survey, their opinion seems divided over valuations of the market, despite the fact that half of them are more bullish of the equity market compared to three months before. 
 
“Fund managers are more hopeful of better earnings growth for the next year (FY14) as compared to FY13. Total 75% of respondents expect earnings growth to be in the range of 10%-15% in FY14 as compared to 5%-10% in FY13,” mentions the report.
 
Majority of them prefer large-cap stocks to perform better in the next one year compared to mid-cap stocks. Banking and pharma sectors remain among the preferred sectors. FMCG/consumer staples and media sector also gained in preference compared to the last survey. The preference for pharma and IT sectors has reduced as compared to the previous survey.
 
As far as global factors affecting the market are concerned, the recent sharp volatility in currency has increased concerns. Global crude oil prices remain a major concern and the European sovereign debt crisis also remain a worry for the markets. The fund managers don’t feel the slow US economic recovery is a cause of concern, though 8% of the fund managers surveyed in the August 2012 felt it was a cause of concern. New global concerns stated as compared to the last survey are that of the political tension in Middle East and the China slowdown. 
 

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