The Securities and Exchange Board of India (SEBI) has been actively engaged in addressing investor grievances, providing more than 6,300 resolutions through its online grievance redressal system known as SCORES. Statistics reveal a promising improvement, with the backlog of complaints falling to 6,490 by the end of October, down from 6,685 just a month earlier.
The regulator's initiative, SCORES (Sebi Complaints Redress System), was introduced back in June 2011 to simplify the process for investors to lodge complaints against companies, intermediaries, and market infrastructure institutions. Last month alone saw the receipt of 6,132 fresh complaints, highlighting the continued need for such systems as investors seek recourse.
SEBI's report shows its efficiency, having resolved 6,327 complaints against various entities, including firms like Angel One and Groww Invest Tech. Only 15 complaints were reported as overdue, having lingered for more than three months. With the introduction of SCORES 2.0 earlier this year, complaint management has been optimized, allowing for automatic forwarding of grievances to the relevant entities.
Once complaints reach the designated bodies, they are required to respond within 21 days, providing investors with clarity and transparency. If investors find the resolution unsatisfactory, they have the right to request first-level reviews within 15 days, should they wish to escalate the matter. Incidents where investors do not follow through with escalation requests are counted as resolved.
Interestingly enough, the average time to resolve complaints increased to nine days across entities. Meanwhile, those requiring first-level review were addressed in about five days. These minor delays highlight the system’s ability to adapt to investor needs, showcasing SEBI's commitment to improving investor relations.
It’s not just about resolving complaints. SEBI has also been clamping down on unethical practices within the market. Recently, one of its notable actions included imposing hefty penalties on several entities for misconduct related to stock options trading on the Bombay Stock Exchange (BSE). SEBI levied penalties totaling ₹20 lakhs on four distinct entities for engaging in what was classified as non-genuine trades.
This proactive stance reflects SEBI's broader mission to maintain market integrity and protect investors. The regulator’s actions are aligned with its regulatory framework of ensuring fair market practices, aimed at discouraging foul play.
On another front, the regulator has been addressing concerns surrounding fund diversion. SEBI issued a demand notice amounting to ₹26 crores to Reliance Big Entertainment, targeting alleged misappropriation of funds linked with Reliance Home Finance. Such measures signify SEBI's unwavering resolve to uphold accountability among market players.
These regulatory actions are integral to fortifying investor trust within India's financial infrastructure, creating space for transparency and ethical dealings. With the modernization of complaint management through online platforms and strict enforcement of punitive measures, the message from SEBI to both investors and market participants is unmistakably clear: adherence to market regulations is not just encouraged, but enforced.
The financial sector has increasingly been under scrutiny, and SEBI's recent actions foreshadow the continual evolution of compliance expectations. The regulator’s comprehensive strategy not only addresses complaints but also proactively mitigates risks of exploitation within the market.
One can't overlook the larger narrative generated by such initiatives. SEBI's outreach has made strides to bolster consumer protection and promote more informed investing by enabling easier access to support and resolution avenues. They are making it easier for the common person to engage with the financial markets, understand their rights, and act upon grievances if they feel defrauded or misled.
Besides resolutions and penalties, investor awareness plays a significant role. SEBI's efforts include educational initiatives aimed at empowering investors with knowledge about market practices, potential red flags, and mechanisms available for grievance redress.
SEBI's recent endeavors encapsulate its dual role: as both the guardian of investor interests and the vigilant overseer of market conduct. By balancing these responsibilities, SEBI not only enhances operational efficacy within financial markets but also cultivates public confidence, which is fundamental for the sector's long-term sustainability.
The hurdles remain tremendous, but with continuous adjustments and regulatory refinements, SEBI appears determined to pave the way for a more equitable marketplace, reflecting the commitment to enhancing regulatory practices and upholding investor rights.
