The government is pooling in its regulatory resources to frame a comprehensive rule-book for wealth management advisors and has sought inputs for the same from RBI, Sebi and other financial sector regulators. The move follows an estimated Rs 400-crore fraud allegedly perpetuated by a relationship manager at a Gurgaon branch of Citibank and initial probe into the matter pointing towards various loopholes in existing regulations.
Besides RBI and Sebi, other financial sector regulators, namely commodity regulator FMC, insurance watchdog IRDA and pension fund regulator PFRDA, will also be roped in to formulate the all-encompassing wealth management guidelines.
After their initial probe into the Citibank case, banking regulator RBI and capital market watchdog Sebi have felt the need for stricter regulations for wealth management advisors, given the huge surge in the size of assets managed by them.
