Sebi working on AI tool to curb misselling by mutual funds: Madhabi Puri Buch
artificial intelligence tool to help detect misselling by mutual funds, its Chairperson Madhabi Puri Buch said on Tuesday. She cited a recent incident of a 90-year-old being sold a product with a seven-year lock-in period to illustrate an instance of misselling, and said algorithms will help flag such cases.
«We are working on the question of misselling that may happen by a mutual fund distributor or an agent or by someone who is the responsibility of the mutual fund,» Buch said while speaking at the fourth Global Fintech Fest here.
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Offering CollegeCourseWebsiteNorthwestern UniversityKellogg Post Graduate Certificate in Product ManagementVisitIndian School of BusinessISB Professional Certificate in Product ManagementVisitNorthwestern UniversityKellogg Post Graduate Certificate in Digital MarketingVisitIIM LucknowIIML Executive Programme in Data ScienceVisit She admitted that this is a very complex problem requiring intelligence, and added that the algorithm being built will have the essential tools to detect misselling like flagging the case of a 90-year-old being sold the product with a long lock-in period.
At present, mutual funds submit essential data to Sebi periodically with respect to compliance with regulations. A «nil report» is considered the best, Buch said.
At the same time, Buch said there may be misselling that may go unnoticed in the rule-based supervision and those same will be detected with the AI tool.
«As we move to using AI to analyse the data, we hope that we will also find the ability to monitor these things (misselling) in the interest of the investors,» she said.
Meanwhile, Buch said the regulator is also keen to introduce fractional ownership
