Your financial rights

MONEY TODAY presents the first ever charter of your financial rights. Know what they are and how to get redressal for your investor grievances.

Rakesh Rai        Print Edition: November 1, 2007

Been sold an insurance policy that’s all wrong for you? Bought stocks but aren’t getting dividends? Home developers playing hard-to-get? Recovery agents camping in your kitchen? Till some years ago, you’d have just had to put up with all of this—losing money, sleep and temper in the process.

By and large, the Indian investor community has been docile, letting companies get away with scams of monumental proportions.

The good news is that for some years now, investors have begun fighting back. And that has led to most regulators and financial bodies putting some sort of consumer redressal mechanism in place.

But the bad news is that even if some investors are aware of the existence of these mechanisms, most of them don’t realise that they can get help for even the least of their problems. And that’s where we come in.

For the past one year, we’ve been telling you how you can make the most of your money. Now, we tell you what you can do if something goes wrong. There’s also the small matter of your duties as a consumer, which we touch upon. As far as rights go, one of the most empowering moves has been the Right to Information or the RTI Act.

Did you know...

>> Motor insurance is transferred automatically with ownership of the vehicle?
>> Some banks have been accused of sending credit card bills late in order to charge late fees and fines?
>> Recovery agents cannot threaten you even if you have defaulted on EMI payments?
>> Trading in a listed company can be suspended if it has a backlog of unresolved investor complaints?
>>Mutual funds cannot increase the load beyond the level mentioned in the offer document?
>> Banks earn Rs 620 crore a day in interest from delays in cheque clearance?
>> You can use the RTI Act to get information that can lead to charges of corruption against income tax officials?

Consumers can insist on getting details about transactions that companies would rather bury. There’s no such thing as too much information when it comes to investments.

The role of the ombudsman in almost every financial sector, from banking and insurance to tax and telecommunications, is steadily gaining importance.

Aggrieved consumers can also approach government and quasi-government organisations. For instance, the Monopolies and Restrictive Trade Practices Commission takes up cases against real estate companies and credit card issuers and the like.

In the case of non-banking financial companies (NBFCs), depositors can approach the Company Law Board for assistance.

Finally, there’s the option of going to the civil or consumer court. (Investors are consumers of financial services and are covered under the Consumer Protection Act.) All of which is very well, but when do you approach these bodies? What exactly are your rights as an investor? Read on and find out.

Next page: Insurance - Cover or cover-up?

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