Excelsior Correspondent
JAMMU, July 21: Association of Mutual Funds in India (AMFI) has clarified that as reported in the section of press creating confusion among the minds of the investors, the term `freezing of accounts’ in Mutual Fund parlance merely means permitting further transaction in the account only after the requirement is fulfilled, which is the context of FATCA compliance, to provide a self certification about one tax residency.
While further clarifying, a spokesman of the AMFI (Mumbai) said that some recent reports have created confusion as some people seem to have misunderstood/ mis-interpretted the term freezing of accounts to mean impounding of accounts. He said when a folio is freezed, the investor’s account would continue earn the returns/ benefits accruing in the normal course. It has been reported that 5 million Mutual Fund folios are facing risk of closure due to non-submission of FATCA self certification by the investors, involving redemption value in excess of Rs one lakh crore, creating confusion among the masses.
He further said that for FATCA compliance, all that the investors need to do is to provide a simple self certification in the prescribed form that helps determine whether the investor has tax residency in other countries, particularly USA. Mutual Funds and their Registrars have been making concerned and persistent efforts to obtain FATCA self- certification from the investors through various modes since the FATCA compliance became a law, he added.
The spokesman further said that for the ease of investors the Mutual Fund Registrars namely CAMS, KARVY and Sundram BNP Pariba Fund Services have facilitated submitting a single FATCA self certification form for all the Mutual Fund serviced by the respective RTAs through an online mode wherein, a customer could provide the information online through a specified link.
In addition, the RTAs and AMCs have also provided an option to download a PDF of FATCA declaration form, which can be submitted at any nearest service centre of the RTA/AMC, duly completed. He said currently, 22 Mutual Funds are serviced by KARVY, while 18 Mutual Funds by CAMS and two MFs are serviced by Sundram BNP Paribas Fund Services.
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