How is SEBI protecting the interest of investors?

Investors are important to the financial markets. It is thus very important to protect the interests of the investors. Investor protection involves various measures established to protect the interests of investors. Investor protection measures by SEBI are in place to safeguard the investors from the malpractices in shares, the stock market, Mutual Funds, etc.

Investor Protection Measures by SEBI:

The Investor protection legislation is implemented under the Section 11(2) of the SEBI Act. Some of the measures are as follows:

• Stock Exchange and other securities market business regulation.
• Registering and regulating the intermediaries of the business like brokers, transfer agents, bankers, trustees, registrars, portfolio managers, investment consultants, merchant bankers, etc.
• Recording and monitoring the work of custodians, depositors, participants, foreign investors, credit rating agencies, etc.
• Registering investment schemes like Mutual fund & venture capital funds, and regulating their functioning.
• Promotion and controlling of self-regulatory companies.
• Keeping a check on frauds and unfair trading methods related to the securities market.
• Carry out investor awareness and education programme.
• Train the intermediaries of the business.
• Inspecting and auditing the security exchanges (SEs) and intermediaries.
• Assessment of fees and other charges.

You can also lodge your complaint to SEBI on its SCORES website. SCORES stands for SEBI Complaints Redress System.One can go and lodge a complaint against any listed company, registrar, brokers, stock exchanges, depository, Mutual Funds, etc on it.

Also, as said above SEBI has launched Investor Protection Fund (IPF) and Investor Education and Protection Fund(IEPF) to compensate investors. Investor Protection Fund is set up in order to compensate the claims of investors against the members of exchanges (brokers) who have defaulted or failed to pay.

And under IEPF fund, all the share applications money, dividends, matured deposits, interest, debentures, etc. that are unclaimed for over seven years are pooled together. Investors who failed to collect their dividends or interests etc. can now seek a refund from IEPF.