SEBI gives mutual fund managers freedom to talk “off the record”

Mutual fund managers and dealers will no longer be required to record face-to-face conversations — including meetings held outside office premises — starting August 3, 2025, following a key amendment to the SEBI Mutual Fund Regulations. However, phone calls during market hours will still need to be recorded. The same applies to conversations in dealing rooms.

The amendment is part of a notification issued by the Securities and Exchange Board of India (SEBI) on August 1, 2024, which takes effect next month. The updated regulation excludes in-person interactions from the list of communications that must be conducted through recorded modes or channels, addressing a key concern that fund managers had raised with SEBI.

Mutual Fund Managers Vs Other Money Managers
“This amendment was necessary and brings some level of parity in monitoring standards with other managers, particularly PMS/AIF managers,” said a fund manager on condition of anonymity.
Even so, the monitoring standards are lower for PMS and AIF fund managers. They are not required to record phone calls during market hours. However, dealing room conversations must be recorded.
Similarly, insurance companies—which also manage large investments—are not subject to any communication recording requirements, according to IRDA regulations. That said, dealing room conversations must be recorded by insurance companies as well.

Previously, the code of conduct under the Mutual Fund Regulations mandated that all communication during market hours be conducted strictly through recorded platforms. The latest change, however, distinguishes between digital and physical interactions, allowing more flexibility for in-person meetings without compromising the overall integrity of the compliance framework.