Investor Charter, MITC & AML Policy |

Investor Charter, MITC & AML Policy

Investor Charter - Research Analyst (RA)

A. Vision and Mission Statements for investors

Vision

Invest with knowledge & safety.

Mission

Every investor should be able to invest in right investment products based on their needs, manage and monitor them to meet their goals, access reports and enjoy financial wellness.

B. Details of business transacted by the Research Analyst with respect to the investors

To publish research report based on the research activities of the RA
To provide an independent unbiased view on securities.
To offer unbiased recommendation, disclosing the financial interests in recommended securities.
To provide research recommendation, based on analysis of publicly available information and known observations.
To conduct audit annually
To ensure that all advertisements are in adherence to the provisions of the Advertisement Code for Research Analysts.
To maintain records of interactions, with all clients including prospective clients (prior to onboarding), where any conversation related to the research services has taken place.

C. Details of services provided to investors (No Indicative Timelines)

Onboarding of Clients

Sharing of terms and conditions of research services
Completing KYC of fee paying clients

Disclosure to Clients:

To disclose, information that is material for the client to make an informed decision, including details of its business activity, disciplinary history, the terms and conditions of research services, details of associates, risks and conflicts of interest, if any
To disclose the extent of use of Artificial Intelligence tools in providing research services
To disclose, while distributing a third-party research report, any material conflict of interest of such third-party research provider or provide web address that directs a recipient to the relevant disclosures
To disclose any conflict of interest of the activities of providing research services with other activities of the research analyst.

To distribute research reports and recommendations to the clients without discrimination.
To maintain confidentiality w.r.t publication of the research report until made available in the public domain.
To respect data privacy rights of clients and take measures to protect unauthorized use of their confidential information
To disclose the timelines for the services provided by the research analyst to clients and ensure adherence to the said timelines
To provide clear guidance and adequate caution notice to clients when providing recommendations for dealing in complex and high-risk financial products/services
To treat all clients with honesty and integrity
To ensure confidentiality of information shared by clients unless such information is required to be provided in furtherance of discharging legal obligations or a client has provided specific consent to share such information.

D. Details of grievance redressal mechanism and how to access it

1. Investor can lodge complaint/grievance against Research Analyst in the following ways:

Mode of filing the complaint with research analyst
In case of any grievance / complaint, an investor may approach the concerned Research Analyst who shall strive to redress the grievance immediately, but not later than 21 days of the receipt of the grievance.

Mode of filing the complaint on SCORES or with Research Analyst Administration and Supervisory Body (RAASB)
i. SCORES 2.0 (a web based centralized grievance redressal system of SEBI for facilitating effective grievance redressal in time-bound manner) (https://scores.sebi.gov.in) Two level review for complaint/grievance against Research Analyst:

First review done by designated body (RAASB)
Second review done by SEBI

ii. Email to designated email ID of RAASB

2. If the Investor is not satisfied with the resolution provided by the Market Participants, then the Investor has the option to file the complaint/ grievance on SMARTODR platform for its resolution through online conciliation or arbitration.

With regards to physical complaints, investors may send their complaints to:

Office of Investor Assistance and Education,
Securities and Exchange Board of India,
SEBI Bhavan, Plot No. C4-A, ‘G’ Block,
Bandra-Kurla Complex, Bandra (E),
Mumbai – 400 051

E. Rights of investors

Right to Privacy and Confidentiality
Right to Transparent Practices
Right to fair and Equitable Treatment
Right to Adequate Information
Right to Initial and Continuing Disclosure
Right to receive information about all the statutory and regulatory disclosures
Right to Fair & True Advertisement
Right to Awareness about Service Parameters and Turnaround Times
Right to be informed of the timelines for each service
Right to be Heard and Satisfactory Grievance Redressal
Right to have timely redressal
Right to Exit from Financial product or service in accordance with the terms and conditions agreed with the research analyst
Right to receive clear guidance and caution notice when dealing in Complex and High-Risk Financial Products and Services
Additional Rights to vulnerable consumers
Right to get access to services in a suitable manner even if differently abled
Right to provide feedback on the financial products and services used
Right against coercive, unfair, and one-sided clauses in financial agreements

F. Expectations from the investors (Responsibilities of investors)

Do’s

Always deal with SEBI registered Research Analyst.
Ensure that the Research Analyst has a valid registration certificate.
Check for SEBI registration number.
Please refer to the list of all SEBI registered Research Analyst which is available on SEBI website in the following link: https://www.sebi.gov.in/sebiweb/other/OtherAction.do?doRecognisedFpi=yes&intmId=14
Always pay attention towards disclosures made in the research reports before investing.
Pay your Research Analyst through banking channels only and maintain duly signed receipts mentioning the details of your payments. You may make payment of fees through Centralized Fee Collection Mechanism (CeFCoM) of RAASB if research analyst has opted for the mechanism. (Applicable for fee paying clients only)
Before buying/ selling securities or applying in public offer, check for the research recommendation provided by your Research Analyst.
Ask all relevant questions and clear your doubts with your Research Analyst before acting on recommendation.
Seek clarifications and guidance on research recommendations from your Research Analyst, especially if it involves complex and high risk financial products and services.
Always be aware that you have the right to stop availing the service of a Research Analyst as per the terms of service agreed between you and your Research Analyst.
Always be aware that you have the right to provide feedback to your Research Analyst in respect of the services received.
Always be aware that you will not be bound by any clause, prescribed by the research analyst, which is contravening any regulatory provisions.
Inform SEBI about Research Analyst offering assured or guaranteed returns.

Don’ts

Do not provide funds for investment to the Research Analyst.
Don’t fall prey to luring advertisements or market rumors.
Do not get attracted to limited period discount or other incentive, gifts, etc. offered by Research Analyst.
Do not share login credential and password of your trading, demat or bank accounts with the Research Analyst.

Most Important Terms and Conditions -

Introduction

SEBI has specified that RA terms and conditions shall include the Most Important Terms and Conditions (‘MITC’) to be disclosed by RAs and the same shall be standardized by Industry Standards Forum (‘ISF’) in consultation with RAASB and SEBI. The below are the latest version of such MITC.

Relevant SEBI Circulars:

1) Most Important Terms and Conditions (MITC) for Research Analysts

https://www.sebi.gov.in/legal/circulars/feb-2025/most-important-terms-and-conditions-mitc-for-research-analysts_91965.html

2) Relaxation of provision of advance fee restrictions in case of Investment Advisers and Research Analysts

https://www.sebi.gov.in/legal/circulars/apr-2025/relaxation-of-provision-of-advance-fee-restrictions-in-case-of-investment-advisers-and-research-analysts_93251.html

Most Important Terms and Conditions

These terms and conditions, and consent thereon are for the research services provided by the Research Analyst (RA) and RA cannot execute/carry out any trade (purchase/sell transaction) on behalf of, the client. Thus, the clients are advised not to permit RA to execute any trade on their behalf.
The fee charged by RA to the client will be subject to the maximum of amount prescribed by SEBI/ Research Analyst Administration and Supervisory Body (RAASB) from time to time (applicable only for Individual and HUF Clients).

       Note:

The current fee limit is Rs 1,51,000/- per annum per family of client for all research services of the RA.

The fee limit does not include statutory charges.

The fee limits do not apply to a non-individual client / accredited investor.
RA may charge fees in advance if agreed by the client. Such advance shall not exceed the period stipulated by SEBI; presently it is one year. In case of pre-mature termination of the RA services by either the client or the RA, the client shall be entitled to seek refund of proportionate fees only for unexpired period.
Fees to RA may be paid by the client through any of the specified modes like cheque, online bank transfer, UPI, etc. Cash payment is not allowed. Optionally the client can make payments through Centralized Fee Collection Mechanism (CeFCoM) managed by BSE Limited (i.e. currently recognized RAASB).
The RA is required to abide by the applicable regulations/ circulars/ directions specified by SEBI and RAASB from time to time in relation to disclosure and mitigation of any actual or potential conflict of interest. The RA will endeavor to promptly inform the client of any conflict of interest that may affect the services being rendered to the client.
Any assured/guaranteed/fixed returns schemes or any other schemes of similar nature are prohibited by law. No scheme of this nature shall be offered to the client by the RA.
The RA cannot guarantee returns, profits, accuracy, or risk-free investments from the use of the RA’s research services. All opinions, projections, estimates of the RA are based on the analysis of available data under certain assumptions as of the date of preparation/publication of research report.
Any investment made based on recommendations in research reports are subject to market risks, and recommendations do not provide any assurance of returns. There is no recourse to claim any losses incurred on the investments made based on the recommendations in the research report. Any reliance placed on the research report provided by the RA shall be as per the client’s own judgement and assessment of the conclusions contained in the research report.
The SEBI registration, Enlistment with RAASB, and NISM certification do not guarantee the performance of the RA or assure any returns to the client.
For any grievances,

Step 1: the client should first contact the RA using the details on its website or following contact details:

Designated Grievance Officer Sujay Chaudhari @ tradeflaircap@gmail.com

Step 2: If the resolution is unsatisfactory, the client can also lodge grievances through SEBI’s SCORES platform at www.scores.sebi.gov.in Step 3: The client may also consider the Online Dispute Resolution (ODR) through the Smart ODR portal at https://smartodr.in

Clients are required to keep contact details, including email id and mobile number/s updated with the RA at all times.
The RA shall never ask for the client’s login credentials and OTPs for the client’s Trading Account Demat Account and Bank Account. Never share such information with anyone including RA.

AML Policy :

Provisions of Prevention of Money Laundering Act, 2002

Prevention of Money Laundering Act, 2002 (PMLA) forms the core of legal framework put in place by India to combat money laundering and related crimes. PMLA and the Rules notified there under came into force from 1st July, 2005. Under PMLA, all the entries registered with SEBI are required to furnish information of all the suspicious transactions whether or not made in cash to FIU-IND. Under Section 3 of PMLA, projecting of crime as untainted property is an offence of money laundering liable to be punishment under section 4 of the PMLA.

Money Laundering involves disguising financial assets so that they can be used without detection of the illegal activity that produced them. Through money laundering, the launderer transforms the monetary proceeds derived from criminal activity into funds with as apparently legal source.

Financial Intelligence Unit-India (FIU-IND) is the central national agency of India responsible for receiving, processing, analyzing and disseminating information of suspect financial transactions. FIU-IND is also responsible for coordinating and strengthening efforts of national and international intelligence, investigation and enforcement agencies in combating money laundering and related crimes.

Section 2 (1) (g) of PMLA Rules defines suspicious transaction whether or not made in cash which, to a person acting in good faith:

➢ Gives rise to a reasonable ground of suspicious that it may involve the proceeds of crime: or

➢ Appears to be made in circumstances of unusual or unjustified complexity; or

➢ Appears to have no economic rationale or bonafide purpose; or

➢ Gives rise to a reasonable ground of suspicious that it may involve facing of the activities relating to terrorism

Policy and Procedures for Anti Money Laundering Measures

The policy and procedures as outlined below provides a general background on the subjects of money laundering and terrorist financing summarizes the main provisions of the applicable anti-money laundering and anti-terrorist financing legislation in India and provides guidance on the practical implications of the Act. The same also sets out the steps that a registered intermediary and any of its representatives, should implement to discourage and identify any money laundering or terrorist financing activities.

The Prevention of Money Laundering Act, 2002 has come into effect from 1st July 2005. Necessary Notifications / Rules under the said Act have been published in the Gazette of India on 1st July 2005 by the Department of Revenue, Ministry of Finance, Government of India.

As per the provisions of the Act, every banking company, financial institution (which includes chit fund company, a co-operative bank, a housing finance institution and a non-banking financial company) and intermediary (which Includes a stock-broker, sub-broker, share transfer agent, banker to an issue, trustee to a trust deed, registrar to an issue, merchant banker, underwriter, portfolio manager, investment adviser and any other intermediary associated with securities market and registered under section 12 of the Securities and Exchange Board of India Act, 1992) shall have to maintain a record of all the transactions; the nature and value of which has been prescribed in the Rules under the PMLA. Such transactions include:

• All cash transactions of the value of more than Rs. 10 lacs or its equivalent in foreign currency.

• All series of cash transactions integrally connected to each other which have been valued below Rs 10 lakhs or its equivalent in foreign currency where such series of transactions take place within one calendar month.

• All suspicious transactions whether or not made in cash and including, inter-alia, credits or debits into from any non-monetary account such as demat account, security account maintained by the registered intermediary.

We should adopt written procedures to implement the anti-money laundering provisions as envisaged under the Anti Money Laundering Act, 2002. Such procedures should include inter alia, the following three specific parameters which are related to the overall ‘Client Due Diligence Process’:

a) Policy for acceptance of clients

b) Procedure for identifying the clients

c) Transaction monitoring and reporting especially Suspicious Transactions Reporting (STR)

Client Due Diligence Process

The customer due diligence (“CDD”) measures comprise the following:

a. Obtaining sufficient information in order to identify persons who beneficially own or control securities account.

As an organization providing Research Analyst Services, details of securities account of clients are not shared with us in the process of delivering services and execution services are not part of our service package. Accordingly, identifying the beneficial owner or controlling party of the securities account of the client is the responsibility of the broker handling the security account of the client.

b. Verify the customer’s identity

Since Research Analyst regulation does not envisage on the KYC of the clients, basic KYC detail i.e., PAN card number to establish identity of the client are to be collected from the clients. KYC Status of the clients are to be verified using below link: -

https://kra.ndml.in/kra-web/jsps/pos/KYCClientInquiry_NEW.jsp

Or,

https://www.karvykra.com/UPanSearchGlobalWithPanExempt.aspx

c. Identify beneficial ownership and control, i.e. determine which individual(s) ultimately own(s) or control(s) the customer and/or the person on whose behalf a transaction is being conducted

Transaction data is not handled by us as the client doesn't share such data with us as part of our research services. We provide non-discretionary research recommendation service, execution of which is on the discretion of the client, and execution is handled by client themselves. Client don't share any executional or transactional data with us. Accordingly, identifying the beneficial owner or controlling party of the securities account of the client is the responsibility of the broker handling the security account of the client.

As part of client due diligence process below guidelines are to be adhered to-

a. Policy for acceptance of clients

Following safeguards are to be followed while accepting the clients:

• No account is opened in a fictitious / benami name or on an anonymous basis.

• Ensure that an account is not opened where you are unable to apply appropriate client’s due diligence measures / collect basic KYC detail i.e., PAN card number.

• Ensure that the client is KYC registered.

• The client should not be permitted to act on behalf of another person/ entity for service delivery

• Do not accept clients with identity matching with banned person/ entity as per SEBI/ Stock Exchanges in capital market: -check whether the client‘s identity matched with persons debarred/ banned by SEBI before opening of account. If you find them in that list then do no open the account. List may be verified using below link-

https://www.bseindia.com/investors/debent.aspx?expandable=4

https://www.nseindia.com/regulations/member-sebi-debarred-entities

• Conduct Risk assessment which takes into account any country specific information using the updated list of individuals and entities who are subjected to sanction measures as required under the various United Nations' Security Council Resolutions. Do not on-board a client who is present in the list.

These can be accessed at the URLs

http://www.un.org/sc/committees/1267/aq_sanctions_list.shtml and

http://www.un.org/sc/committees/1988/list.shtml

b. Procedure for identifying the clients

The client identification procedure to be carried out at the time of establishing the client relationship i.e. onboarding the client. Since Research Analyst regulation does not envisage on the KYC of the clients, basic KYC detail i.e., PAN card number of the client are to be collected from the clients to establish identity of our clients whom the services are delivered.

Failure by prospective client to provide satisfactory evidence of identity should be noted and reported to the higher authority and service should not be started for the said client.

c. Maintenance of record

All the records of the clients are to be maintained for a minimum period of 10 Years or in case of any regulatory action till the time the same is resolved.

d. Audit

Audit of RA activities to be done by an independent professional as allowed by the regulation. Any observations of audit to be taken on priority basis and corrective actions to be initiated.

e. Transaction monitoring and reporting especially Suspicious Transactions Reporting (STR)

Only Transaction encountered while delivering the service is collection of fees as we don’t have access to the execution of transaction data of the clients. Accordingly, the fee collection should be through our bank account only. Further, no cash transaction should be allowed for fee payment by the clients.

The nature and value of transactions, which has been prescribed in the Rules under the PMLA to maintain and record includes:

All cash transactions of the value of more than Rs 10 lacs or its equivalent in foreign currency.
All series of cash transactions integrally connected to each other which have been valued below Rs 10 lakhs or its equivalent in foreign currency where such series of transactions take place within one calendar month.
All suspicious transactions whether or not made in cash and including, inter-alia, credits or debits into from any non-monetary account such as demat account, security account maintained by the registered intermediary.

Any suspicious transactions will be immediately notified to the Compliance Officer. The notifications may be done in the form of a detailed report with specific references to the clients, transactions and the nature/reason of suspicion. The compliance staff members will have timely access to customer identification data and other CDD information, transaction records and other relevant information.

Compliance Officer will carefully go through all the reporting requirements and formats as per the provision of PMLA

a) The Principal Officer will be responsible for timely submission of CTR and STR to FIU-IND

b) Utmost confidentially will be maintained in filling of CTR and STR to FIU- IND.

c) The reports will be transmitted by speed/registered post/fax at the notified address.

d) No nil reporting will be made to FIU-IND in case there are no cash/suspicious transaction to be reported.

Reporting to FIU – India

In terms of the PMLA rules, BMWA will report information relating to cash and suspicious transactions to The Director, Financial Intelligence Unit India (FIU – IND) at the following address:

Director, FIU – IND

Financial Intelligence Unit India 6^th floor,

Hotel Samrat Chanakyapuri

New Delhi – 110021

Role of Staff

Principal Officer

The Principal Officer is responsible for the following:

Communicating the policy on prevention of Money laundering to the employees.
Receiving reports from employees for any suspicious dealing noticed by them.
Clarification of any queries from employees on this matter.
Ensuring that the employees dealing with the clients/prospective clients are aware of the guidelines and are advised to follow the same strictly.
Report any suspicious transactions to appropriate authorities.
Handle compliance function and to ensure compliance with the policies, procedures, and controls relating to the prevention of ML and TF
Evaluate the process in case any gaps are identified

On-Boarding Staff

For staff members dealing with customers or handling customer-facing processes, it is essential to be sensitive to the AML requirements and obligations

Primary responsibility of compliance is on the on-boarding staff since they deal face-to-face with customers.
On-boarding staff to carry out KYC process/ customer due diligence process / any further checks required as per our process during new business and renewal
Default on carrying out obligation under AML law can attract action as per set company policies
If you come to know of any suspicious activity, you have to bring that to our notice

Communication of Policy

Copy of above policy is to be provided to all the management and relevant staff that handle account information, securities transactions, money and client records etc. whether in branches, departments or subsidiaries; An internal session on awareness of the above policy is to be conducted on a yearly basis in 1st week of April to spread awareness of the same among all the relevant person(s).

Compliance with relevant statutory and regulatory requirements

It is to be ensured that the activities are in compliance with all the relevant statutory and regulatory requirements.

Co-operation with the relevant law enforcement authorities, including the timely disclosure of information

As and when sought appropriate information’s of the clients as maintained are to be shared with the relevant law enforcement authorities and timely disclosures of the information’s to be made as per the requirement.

Review of Policy and Procedures

Management of the Research Analyst is to review the policies and procedures on the prevention of ML and TF to ensure their effectiveness as and when there is change in regulatory guidelines with respect to prevention of ML and TF.

………………………………………………….

For,

SUJAY CHAUDHARI

SEBI Registered Research Analyst

SEBI Registration No. - INH000015880

BSE Enlistment No. - 5573