Imagine the case of a senior citizen (that too, over 80 years old) having a bank account. For such a person (and indeed for all of us), it is essential that institutions such as banks and others that hold money for these citizens act in a proper responsible manner, and ensure that all complaints are attended to. In addition, banks need to not act as cold impersonal places and instead treat people with courtesy and listen to them. In the case of a senior citizen in Delhi whose account balance was reduced by UTI bank, the bank has been fined a sum of Rs. 1 lakh by the Delhi State Consumer Commission:

The Delhi State Consumer Commission has slapped a penalty of Rs 1 lakh on a private sector bank for lapses in finalising the account of an 85-year-old customer. The Commission asked the UTI Bank (now known as Axis Bank) to pay the amount to octogenarian Surya Narayan Saxena, a resident of Swasthya Vihar, who alleged that the bank had paid him less interest on a deposit and also reduced balance amount in his saving bank account.
Saxena, who was having a saving account with the bank, lodged a complaint with the district forum in March 2006 on the ground that his balance amount had been reduced from Rs 3.83 lakh to 3.29 lakh in March 2003. His another grievance was that he was paid less amount of interest on his fixed term deposit. The Commission termed the shortfall of over Rs 50,000 in accounts as “unexplained and truly alarming” to Saxena.

It needs to be remembered that banks hold money for its account holders and the money is owned by the account holder and not the bank, and it is the right of the citizen to demand full satisfaction for his / her queries and that any discrepancy be explained. If not, then the account holder has the full right to ask for an explanation from the ombudsman or a consumer court.

When an investor, typically a small investor invests in an IPO, the expectation is that this will be a fair process and that he stands a fair chance of getting the stock applied for, if everything goes fairly. However, if there are people who are trying to manipulate the system, then the companies who are carrying out the IPO execution and allotment need to make sure that any attempts to manipulate the system don’t work. However, as we have seen in the past, such things don’t always happen.

The Securities and Exchange Board of India (Sebi) has imposed a fine of Rs 3 crore on the Central Depository Services (CDSL) and Rs 5 crore on National Securities Depository (NSDL), alleging “various lapses and irregularities” on their part, which resulted in distortion in allotment during recent IPOs. In two separate orders dated April 27, the market regulator said key operators opened a large number of fictitious/benami accounts with the two depositories, which enabled them to corner shares in the retail portion of the IPOs between 2003 and 2005.
According to Sebi, as many as 34,924 different accounts were opened with depository participants affiliated to NSDL, and 21,698 afferent accounts were opened with depository participants affiliated to CDSL. As part of the investigation, Sebi checked the trading pattern in 21 IPOs including TCS, Jet Airways, Yes Bank, NTPC, IDFC, between 2003 and 2005.

If these institutions such as CDSL and NSDL don’t carry out their responsibilities properly, then it is a gross violation of the trust that they carry. It also lowers the confidence of the normal retail investor in the fairness of the market, and that is a very bad thing to happen, something to be avoided at all costs.

The reason most movie tickets are so expensive is because of the large amount of tax that the Government charges in the form of entertainment tax. However, for avid film buffs, this extra charge makes movie watching all the more expensive, and something that these people need to be more careful about. In addition, it impacts the film business in the country, with films being more expensive to watch and a large portion of the money not going to the person who made the movie, but to the Government. Which is why, when a film has the entertainment tax removed, ticket prices become much cheaper, and more people can go and see the movie. In a new move, the Information and Broadcasting Industry has proposed to reduce the taxes, which will be very much in the interest of people:

“While entertainment tax on films has gradually been reduced from 70% to an average of about 50%, we have recommended a further reduction to 25-30%,” I&B minister Priya Ranjan Dasmunsi said. “This will give a boost to the exhibition sector and reduction of ticket rates would encourage more viewership,” he added.
A cut in entertainment tax can affect the fortunes of a film substantially. Says distributor Sanjay Mehta, whose film Omkara was made tax-free in Uttar Pradesh, “The film’s collections went up by 15-20% after the tax exemption.”

Let us hope that the Ministry does not buckle down to pressure from the Finance Ministry which does not take kindly to people proposing reduction in taxes and duties.

The Mutual Fund industry runs on being able to sell funds to investors, and make money out of the initial commission and entry charges. This is something that most consumers do not know much about, and it is primarily SEBI and a few other parties who are trying their best to make sure that the Mutual Fund companies become much more rational in their charges and have a lot more discipline. This is a good initiative by SEBI in the interest of small shareholders who do not know too much about all these charges, and end up paying much more.
Market regulator SEBI is likely to prohibit close-ended MFs from charging up to 6% of the corpus as initial offer expenses, which is then amortised over a period of time. The move is aimed at bringing transparency in the manner in which MFs charge expenses to close-ended schemes. The proposal has implications for investor returns too. As per the proposal under consideration, close-ended funds would only be allowed to charge a certain entry load upfront, like in open-ended funds. When contacted, the Association of Mutual Funds in India (AMFI) chairman AP Kurian said, “We have received the proposal from SEBI and the industry is examining it in detail.”
In April 2006, Sebi had recast regulations relating to initial issue expenses and banned open-ended schemes from charging 6% initial issue expenses. However, the market regulator allowed close-ended schemes to continue with the practice. The open-ended schemes had to meet sales, marketing and other expenses through entry load, which is usually about 2.25%, and not initial issue expenses. Close-ended schemes were not allowed to levy an entry load. The difference in treatment of expenses between open and close-ended schemes has made the latter attractive for fund houses. Against a 2.25% entry load available in the case of open-ended schemes, an AMC can appropriate as much as 6% of the corpus raised by close-ended schemes for advertising and other related upfront expenses, which is not immediately reflected in NAV. As opposed to this, in the case of open-ended schemes, the 2.25% load starts for investors at that much lower NAV. This gives the erroneous impression to the investor that charges are lower in the case of close-ended schemes, which is not the case. Most close-ended funds actually charge 6%, which is the maximum limit available.

Mumbai: Constant harassment by loan recovery agents appointed by a private bank drove a 38-year-old man to kill himself at his Andheri (E) residence on Monday.
Prakash Sarvankar, who was unable to repay all the loan instalments due to illness,wrote a one-page suicide note in Marathi saying that he was driven to take this step because of threats from recovery agents.
Sarvankar stated that the recovery agents, contracted by ICICI Bank, would visit his house and abuse him in the presence of his wife and young daughters. They had even taken away his music system and speakers. Four days before the incident, the agents had threatened Sarvankar with dire consequences if he failed to pay up. They even forced him to submit in writing that he would repay one instalment on Monday. At about 10.30 am on Monday, Sarvankar hanged himself from the ceiling with a dupatta.
“This is a serious offence and I have asked my officers to conduct a detailed probe. Four men have been arrested on charges of abetment of suicide. Of these, three are agents and one is a bank employee,” said zonal DCP K M M Prasanna. The police are also likely to make inquiries with senior ICICI Bank officials.
When contacted, an ICICI spokesperson admitted that Sarvankar was their customer and had taken a loan of Rs 50,000. “The police have summoned three agents from our collection agency based in Andheri for questioning. We are also conducting an inquiry and appropriate action will be taken. As a bank, we would never authorise any of our agencies to use coercive methods.”
It is impossible that officials at ICICI Bank were not aware about this. Such strong-arm methods are condoned by them, and have been in the past criticized by consumer courts and regular courts. Maybe it is time to hold the bank officials liable for abetment to suicide and prosecute them.