Tag: Real Life Experiences

How two readers got justice and got their money back

Posted on by Jagoinvestor

Today I want to show you how 2 fellow readers of this blog were in a fix when it came to their hard-earned money and they were struggling to get justice from their respective banks and financial institutions. They mailed me and commented on this blog and when I saw those comments, I thought – “lets see what can be done!” This is a post where you can learn what kind of things can be done if you are having issues at times and then try to resolve it further.

Case 1: How an old lady got justice from ICICI Prudential

Some months back an old lady named “Nita” commented on this blog how ICICI Prudential representative have taken advantage of the situation and played around with her money. It was not a case of miss-selling, it was actually unethical behaviour (or call some kind of fraud). So I decided to help her in whatever way I could. Here is what she wrote 

Dear Sir,

I was holding ICICI Prudential Life Time Super policy (Policy number: XXXXXXXX) and have already paid two premiums. The third premium was due for payment in July 2009. Due to delay, there were frantic calls from ICICI Bombay office for making the payment. On 28th December 2009 when called again from ICICI Prudential Bombay office, I requested them to get the premium collected as assured by their officials at the time of issuing the policy. I was told by their office that a representative would come on 29-12-2009. On 29th Mr. K N Pandey mobile No XXXXXX a representative of ICICI prudential came and after verifying his credential from Dehli office in-charge Mr. Mratunjay Sharma Mobile No XXXXXXXXXX  a cheque for Rs.50000/- was given. He demanded that a photo and a signed copy of form was required to get the lapsed policy restored. these were given to him.

Later on, finding that instead of a receipt of the premium paid for the old policy (policy number: 05225842),a new policy “LifeStage Assure Pension- policy number: 13129468″ was delivered. This was issued under forged signature.(photocopy attached). Soon after the receipt of the new policy in 3rd week of jan-2010, the matter was reported to the company’s representative Mr. K.N. Pandey and his immediate superior Mr. Akhilesh Gupta Financial adviser of ICICI prudential Mob. no 09838506002 and Delhi office Mr. M Sharma. They accepted their mistake and I was assured that the new policy will be closed and the amount of the premium will be transferred in my old policy no: 05225842.I trusted them since they begged saying that if the matter was reported, they were to lose their jobs.

But, having failed in my efforts the matter was reported to the chairman ICICI Prudential in September 2010. I never got the reply but when I presented all the documents before ICICI Prudential Manager at Kanpur office I was given a copy of reply sent by the Bombay office in Sept 2010.

(photocopy attached)

The local office after having gone through the records and finding my complaint genuine, they again sent the complaint to Bombay office and I was asked to wait. Again there has been no communication from Bombay office but on my approach to local office I have been given a copy which is ditto of the previous reply.(photocopy attached).  On the advice of local branch manager to save my one Lac rupees deposited earlier in policy No. 05225842, I have borrowed the money to deposit Rs ONE Lac i.e. two years premium to get the policy revived. The amount has been debited from my account on 26/05/2011 but I have not yet received any communication regarding revival of my policy.

The fraudulently (under forged signature) issued new policy No 13129468 is still hanging in abeyance and my Rs.50000.00 is at stake. Since I am an old lady with meager source of earning I cannot afford to operate two policies and that’s why I have been trying to get the amount of the second policy credited for the old policy. Since now, I have come to know about IRDA can help in such matters I therefore request your good office to look in to my case and help me to get justice.

Yours faithfully,

NITA TRIPATHI
06/12/2011

What I did

I tried to find out who is the current CEO of the company and tried to find his email id, but failed. Then I found him on facebook and left a message to him (didn’t get any reply). I then contacted a PR agency in Mumbai who earlier contacted me on behalf of ICICI Pru and I knew they must be knowing someone at ICICI Pru who could help the lady. This worked and I got a mail from ICICI saying that they will work on this and get back with their response. I replied back to them on email like this –

If it was a normal misselling case , I would have let this go , as misselling is same as misbuying . but here it was fraudualant activity and without any reason the old lady is harrassed and she is not able to do anything . Please take up this case with priority and more than professional grounds , help the lady on human ground . It would be appreciated if you can follow up with the concerned people who were send to collect the money from lady and even their seniors .

I am cc’ing Mr Kunal Pradhan and lady Nita Tripathi .

Thanks
Manish

The case was resolved and Lady got her money back

After that there was no activity for few days and some weeks back I got a mail from the lady and she confirmed that the things are resolved now.

Dear Mr Manish,

Wish you a VERY HAPPY HEALTHY AND PROSPEROUS NEW YEAR.

I am extremely sorry for not writing to you earlier about the progress in the matter. In fact after your intervention, ICICI Pru immediately responded. They have now cancelled the mis- sold policy and have credited the amount to the old policy account after getting the formalities completed locally.They have issued the receipt and provided the number by email but I have not received the hard copy as yet.

Honestly speaking I have no words to express my gratitude and thanks for all the help. I pray to GOD to give you all the success and happiness in life.

Thanks once again.

Nita Tripathi

Case 2 : How Bharat Kamble got his Rs 24,000 back from ICICI

One reader Bharat Kamble was struggling to get back his money from ICICI Bank. His credit card was charged twice and ICICI was making him run around here and there without any valid reason. Here is the problem he was facing. I thought of using twitter to communicate this issue to ICICI bank and ask them to act on priority.

ICICI Complain on twitter

Within 24 hours, I got a message from ICICI stating a reference number and they asked Bharat to reply back to ICICI and mention that code number in the message subject (I guess they take it with priority and seriousness). Bharat did exactly that and then he got his money back. I asked him to write a testimonial for us and here is what he sent back in email (problem and solution both).

Dear sir,

I am a 29 year old Geotechnical enginner from mumbai. I am planning for migration to Australia and have already applied for an Australian PR (Permanant Residence). On 21st June 2011, i have paid the fees for PR application to the IEA (Immigration Engineers of Australia). The amount was Rs. 24603/-. I gave the details of credit card in the application form and the amount of Rs. 24603/- was deducted from my ICICI credit card. This amount was reflected in my July month statement. Later in the August month statement i saw the same transaction been done again on 22nd July 2011. I called up to the IEA department for clarification. They said that the first transaction was unsuccessful and hence they did the second transaction which was successful.

I told them that the money has been deducted for both the transactions. They said that ask your bank to talk to our bank (commonwealth bank) for the unsuccessful transaction, also they me the reference file number for the failed transaction as a proof. Later daily i had been calling the customer care of ICICI bank for the problem and solutions. but i got only one answer from all of them stating ” its the mistake of commonwealth bank and they have to sort out the issue. The only alternative for this is that to raise a dispute against this amount”). I was really very tensed and worried about this problem. I showed them the reference file number which was given to me by the commonwealth bank , but they said that we cant check this reference number.

On 23rd Sep. 2011, i file a dispute against this transaction with ICICI bank. They told me that it will take 45 days to solve this dispute and also the result make not be in your favour. i was really suffering from a bad time in that period. after 45 days on 18th november, i called the CC of ICICI bank for the status of the dispute and they said that it will take another 45 days to solve the issue.

Finally while surfing on the solutions on internet i came across “jagoinvestor”. I read all the comments (some of the problems were similar to mine one but not the same exactly and thought lets put up my problem over here. Within 24 hrs i got a valuable feedback from Mr. Manish Chauhan. He gave me a code number and said that put this in the subject matter and send this email to [email protected]. I did the same thing and after 3 days i got a reply to that email mentioning that the amount has been debited on your account. I felt like my feets were not on the earth. I was relaxed and happy.

What should i say about this guy. I am very thankful to him.
I would like to inform you all that beware of such kind of theft and use of credit card has to be limited.

 What you can learn from this?

This post was to show you that one should reach some key people in the company and then communicate the issue to them. Just talking to customer care wont help. Reach to CEO, MD directly, mail them and expect some help. Leave messages on twitter or facebook pages of these companies. At times it works. However I am not saying that this will always work, but nothing to lose if you try!

 

Is someone misusing your Financial Documents ?

Posted on by Jagoinvestor

Is it a total truth that you are too careful with your documents? Did someone recently asked for your PAN Xerox (extra) copy without any reason and you gave it without thinking much? Do you handover your Driving license or passport copies to some agent without giving it a second thought? If yes, you need to be careful because this can land you in trouble in big way. There has been a lot of cases reported on this blog by your fellow readers which you can learn from. Let me take some of them.

financial documentation

How one relative misused the pan card for taking loan

A lot of people handover their documents to their relatives without thinking much. They feel they are helping the other person, but you never know how the other person can misuse your documents and get you in trouble. Read this case

One of my cousion taken a two wheeler loan in 2005, and i had given my pan card duly self attested at the time of taken loan.
Now i had applied for 2 wheeler loan in 2010, it got rejected upon applied to CIBIL report i came to know that i m the coapplicant of the two wheeler loan taken by my cousion in 2005. But unfortunetly he died in 2010 . So i had made the complete payment including all bouncing charges as well as the principal amount dues on him. But as i am the co-owner as per the bank records my name also reflect as an overdues amount (Defaulter) in your CIBIL Report which is harming my credit Worthiness in the market. I just spoke to the HDFC CUSTOMER CARE DEPT they said your loan is clear and had been reported to CIBIL upon checking again with CIBIL ,now report shows as settled . I had made full payment still its showing settle please help me out what i need to do now Please note that i do not have any direct dealing with the bank in the above said loan i just made a mistake of giving my sign in the reference column for which i have paid a price of making payment of RS 6322 to bank. (source)

How one friend used friends reference to make his co-applicant

Friends are forever, until they take advantage of your trust. A lot of people give their documents to their friends for being a reference (guarantor), but they themselves don’t understand what does guarantor mean? Read this below case to know what happened with one person

One of my friends took a car loan from a nbfc 3 years back and he wanted a reference for this loan (i now realize there is no such thing as a reference for a loan) i obliged and gave him a duplicate copy of my pan card. For atleast 2 years i have been applying for credit cards and getting rejection letters from all the banks. I finally was fed up with this and decided to get my cibil report and was shocked to see that i was the co-applicant for the car loan my friend had taken 3 years back. He had defaulted on this loan which was reflecting on my cibil report and that being the main reason for me not getting any credit card.

Like i mentioned earlier i had given my friend a copy of my pan card but i had never signed any loan application form, so i followed up with my friend (who still claims that i was supposed to a reference for this loan) and also with the customer care at the NBFC (who i must say were extremely rude). I managed to get the loan application form from the NBFC and i’m a cent percent sure that my signature has been forged on the form. Now my friend (would not want to call him a friend anymore) claims that the person who gave him this loan never told him about me being a co-applicant and he always thought i was only a reference. (source)

How an agent used documents of someone to to take advisor license

We call a lot of agents to home to buy financial products ,we give them our financial documents without realising that it can be misused if we dont want to go for the product later , we never ask it back . Read the following case based on this.

It has come to my notice that an advisor license was taken in my name in MetLife, Asansol Branch under Sales Manager by the name Mr. Debrup Banerjee. This person had approached me for a Life Insurance policy and had some papers signed by me. The Policy never materialized, but the papers (EPIC, PAN Card, Photo) was used to take out a License in my name. In fact, I was working in Bihar Sharif when the IRDA Exam was taken. A more serious and criminal act on part of Mr. Debrup Banerjee was to open an account with the Axis Bank in my name using the same papers. SMS alerts from MetLife has brought these misdeeds of Mr. Debrup Banerjee to my notice. I would request you to take necessary steps to declare the Advisor License, taken by Mr. Debrup Banerjee for MetLife, null and void. (source)

Make sure you take care about whom you are handing over your financial documents to. People can misuse it and take advantage which can get you into trouble later and you will come to know about it only when things are out of control.

Noida Extention Flats in Problem

Posted on by Jagoinvestor

Is your under-construction flatin Noida Extention in danger? No! But there are thousands of buyers who have invested their hard earned money in flats that are being constructed at Noida Extension. In this article I will talk on the issue of Noida Extension and what learnings can we take from this whole issue. For people who are not aware on the recent Supreme Court decision to stop construction in a part of Noida Extension and give it back to farmers from whom it was taken by the Noida Authority in the name of “Land Acquisition”. Now thousands of buyers who booked their flats are in danger of not getting their homes which they had booked.

Background

So the whole issue goes back to 2005-06 when Noida Authority snatched land from farmers saying that the land will be used for “Development” purposes, Industries will be put in, there will be factories which will further help villagers and their future generations get employment and their life will be “great”. They were given pennies for that land. Then later this land was given to Builders for construction purpose and thousands and lacs of investors bought their dream homes in these projects.

The land was under dispute and after a lot of construction has already happened and people have put their hard earned money in lumpsum or through EMI’s. Now Supreme Court says that the land acquisition was illegal and was not done in the right way, so the land now should be given back to farmers. This is only for one part of Noida Extension issue which still affects thousands of buyers and later again there was a judgement passed in favour of farmers for another village.

Now this has given farmers the confidence that even they have a big say in this issue and someone is there to listen to them. All villagers now want a revised compensation at high rates (which I feel is totally right and it should always have been that way) or they want their land back. The builders have already spent crores of rupees in construction buyers have already paid the money for flats or have taken a home loan and paying the EMI. Now if all the land is given back to farmers what will happen to builders and thousands of buyers who bought the homes? Who will bear the loss of the mental agony and financial setback which will come as part of this package?

Recently, the judgement has been postponed till mid Aug 2011, when Allahabad High court will decide on the final judgement for the dozens of villagers land. If it says that the land has to be given back, the situation will get uglier. This whole issue is now engulfing whole of Noida and Greater Noida.

Who is to be blamed ?

Now assuming you have understood the situation, who do you think is the real culprit here? Is it the builders lobby who are known (or I would say secretly known) to manipulate the land acquisition part and then do construction there? Or is it only Noida Authority (read Mayawati Sarkar) and their policies for land acquisition? Or if you allow me to say, is it buyers who didn’t spend too much time to foresee the future of their houses if legal dispute gets uglier later? Who among all took things for granted?

I personally feel that there are two main parties who are really suffering here and those are Farmers and the home buyers. Farmers plight is from long time who are fighting for their rights from years and not even living a life of dignity even after feeding me and you and the whole country. Buyers are those who had spend their life earnings in their dream homes and now are seeing chances of delay, in their dream to own a house. More than financial loss, I see it as a big emotional breakdown. No one is there to hear and address their issues. They are skipping their work and business to give Dharna’s and by showing their outrage in masses.

What do you think is the solution in this case? Do you think incident like these are going to change the way people look at real estate buying? Can this Noida Extension issue teach people to pay more attention in what they are buying?

What do you think about this? Open your heart on comments section and let’s discuss it?

Are you sharing agents commission ? Its Illegal

Posted on by Jagoinvestor

“Discount kitna doge ! Mishra ji mujhe 35% de rahe hain ” , as per Rakesh ,this is exactly how a lot of customers ask their agents commission to be shared with them in Insurance or Mutual funds. Have you ever asked your agent how much discount he can give you on the premium? This happens a lot with LIC agents and other insurance and mutual fund agents. Many times, even agents offer discount or some gift in return, if you buy the policy or mutual funds through them. This practice is illegal and totally against the laws of Insurance Act and SEBI. The agent can even face cancellation of his license if he is found to share his commission. (Read about agents commission in Insurance)

Insurance, mutual funds Commission passback to customers by agents is illegal

It kinda works like this. Suppose, an Insurance agent sells you a policy with a sum assured of Rs. 10 lacs, with a  premium of about Rs. 50,000/- per year. An agent will make around 15,000 in commission for that year, out of which he might offer you a discount of Rs 5,000-10,000 for the first year or he offers you some gift! A lot of insurance agents do this to make sure they do not lose the business or get more and more business . In the same manner, if you have Rs. 30 lacs invested in mutual funds, your agent will get around Rs 10,000/- in trail commissions. It might happen that he can offer you 50% of that commission to make sure you stay with him .

Why you should stop asking share in Agents commission ?

Mutual funds : As per SEBI mandate,  sharing the commissions received from AMC  is illegal and should be avoided . Pass-backs, the practice of sharing a part of the distributors’ commission with the investor, have been made illegal under the code of conduct issued to distributors. “Intermediaries will not rebate commissions back to investors and avoid attracting clients through temptations of rebate/gifts etc” – As per a SEBI circular.

If a mutual fund agent shares his commission with others, it opens a big hole, not just for mis-selling, but also dilutes the whole industry atmosphere. There have been rampant cases, when an agent asks customers to leave their current agent and transfer their funds with them as a new agent (link) and they are ready to transfer a part of agent commission to them (the customers). For example, if a person has Rs 30 lacs invested in a mutual funds, an agent would get around Rs. 10,000/- as trail commission in a particular year. A lot of agents offer 5,000 (50%) back to the customers to attract them. A lot of agents pass back a part of commission and customers get into wrong & ill-suited mutual funds because of their greed!

Insurance : Other than the fact, that it’s illegal, you should not encourage or engage in sharing the agent commissions because, for one thing, it hampers your relationship with agent. Don’t forget that your agent will be the one to help in claim settlement when you are dead. If you snatch his share of commission today, it might leave him with a bitter taste in the mouth and not result in a healthy relationship. So please live and let live! The other important reason, you should avoid asking for agents commissions, is that it leads to mis-selling. If you ask for a share in commission, it will leave agents with less earnings and that would encourage them to sell more by any means, which in turn fuels mis-selling. So in a way the whole “asking commissions back” will hamper investors in the long run. What you sow is what you reap!

As per section 41 of the Insurance Act, “No person shall allow or offer to allow, either directly or indirectly, as an inducement to any person to  take out or renew or continue an insurance in respect of any kind of risk relating to lives or property in India, any rebate of the whole or part of the commission payable or any rebate of the premium shown on the policy, nor shall any person taking out OR renewing  or continuing a policy accept any rebate, except such rebate as may be allowed in accordance with the published prospectuses or tables of the insurer.”

Real Life experience

As per Dhawal Sharma, a Delhi based agent shares his experience

I face this problem day in and day out and many a times have to miss out on prospective clients because they want “passback of commission“. This practice (Sorry to say, but started by LIC agents) is so much part of the Insurance selling culture that 99.9% of the public thinks that it is obligatory on the part of an agent to part with his commission. But even LIC agents were quite smart at that time as they use to pass back comission mostly on ENDOWMENT or MONEYBACK policies which generate hefty renewal commissions as well (Unlike ULIP) and reversely, would be of little or practically no use to the client in the long term. This practice is actually pound foolish , penny wise approach..

I know at least 100 people, regularly buying insurance for their entire family (father , mother, brother,uncle, aunty) for last so many years from SHARMA JI or OFFICE WALE CLERK who passback 20% commission, and if we make a thorough study of their Insurance portfolio, they are underinsured (No term plan), not properly equipped to handle retirement (their agent never knew that annuity fund is tax exempt only upto 1/3 amount), and no proper child planning (In many cases, child plans where child is life insurand and not father).

 

Violation of law using Multi-level marketing in Insurance Policies

For some years now, a new way of selling is evolving. It’s called MLM. Here a big agent sells a policy to some one and makes him a customer. Now, this customer also acts like an agent and starts adding new people in the network and sells them policies. This goes on to many levels, a person earns a part of commissions earned from every person under his personal network. This whole idea of multi-chain selling violates Insurance law and is illegal.

As per Section 41 of the Insurance Act, “A licensed agent, whether individual or corporate, can’t appoint a sub-agent and pass on a commission to another person or entity. Any passing of commission by an agent is construed as rebating and is prohibited under the Act.”

There are many companies operating in different part of our country like TLC Insurance (India) in Bangalore, RMP Infotec in Chennai, Golden Trust Financial Services in Kolkata and SecureLIFE out of New Delhi (read more here and  here)

Responsible Investor = Health Industry

We as buyers, shape this whole industry based on how we act. Over the years, we expected and asked for share in agents commissions, without realising that it will one day work against us resulting in misselling. So please do not support it! A couple of hundreds or thousands is not going to make you rich or poor, but it sure dilutes the whole environment!

Have you ever experienced a situation where agent has tried to give back his commission? Do you think if everyone stops asking for any agents commission back, it can really have any impact?

JagoInvestor/Moneylife helps a customer get his money back

Posted on by Jagoinvestor

What do you do when you are facing un-ethical practices by some company officials and You are not getting justice anywhere? You should reach out directly at the top of the management somehow because, believe me customer care just does not work ! . This is exactly what I did, when one of the readers complained on our forum that one of his friend is facing issues with India Bulls Real Estate from last some weeks. Here is his complaint

Dear Forum Members,

I’m writting this on behalf of my Friend-Colleague, Ravikumar GovindaNaik, who had a very Bad experience with Indiabulls Home Loan division.

Application Ref no with IndiaBulls – 150625

Name: Ravikumar Lamani GovindaNaik

In August 2010, he initiated the process to buy a 30×40 site near Hosur road, Bangalore. Since the property had only B-Khatha and loan amount was only 10 Lakh, most the major bank representatives denied his enquiries.

Then one Mr. Sivakumar from IndiaBulls Home Loans have appeared as life saver to him an agreed to get him the loan amount approved, with the whatever B-Khatha he have. Every now and then he asked for somany documents copies and it went for almost for a month. In between my friend got an SMS from indiabulls informing that his loan got approved. When he asked about this to Sivakumar he told, Loan is approved by Finance Division but Legal team still have to approve. Also he asked my friend to pay Rs. 5,000/- so that lawyer from Legal division would approve the loan amount. My friend disagreed to pay and asked the contact details of the Lawyer to talk. He refused to gave and tried to divert our attention.

When there was only few days to expire the sale agreement with the Land owner, Sivakumar again appeared and told Loan in COMPLETELY approved and shown photocopy of the cheque favoured the Land Owner. Later Land owner had some dispute on the registration amount and canceled the Land deal.

On October 05, 2010 My friend send a mail to Sivakumar and Indiabulls to cancel the Loan, since he no longer needs it. Nobody responded to mails and phone calls even after repeated attempts, and my friend was scared about the blank cheques he have given.

As he feared, on 13-Oct-10 Rs. 2,216/- was withdrawn from his bank account using the cheque claiming as Pre-EMI, eventhough the Loan Amount cheque was never delivered to him. Immediately my friend contacted Sivakumar and his Manager Praveen enquiring about this, but they suggested to contact customer care. When he contacted the customer care they told him to contact Praveen, The MANAGER. Many e-mail written to Sivakumar, praveen and customer care fell into deaf ears.

On top of that, again on 8-Nov-10  Rs. 20,275/- got withdrawn from my friends bank account using another blank cheque claiming as EMI of the Loan Amount, when the loan amount was never disbursed. Now they have stopped answering my friends calls. Do the Financial Institute have the rights to do like this?

The representative was from Indiabulls that we confirmed, called up the customer care, they also have the application reference number. The cheque’s were in favor of Indiabulls Housing Finance Ltd., only the amount was unfilled. They told that cheques are required for security and to initiate EMI-ECS facility. After the second incident of cash withdrawal, my friend used the “stop payment” facility of his bank. When I searched in Google, I could find lots of complaints against Indiabulls Loan services. In this case they have looted the money on top the processing charge Rs. 5,000, charged earlier.

Yesterday, my friend spoke to the representative Sivakumar again and threaten to send the details to RBI and would file a case, he was least bothered. He just told “Do it!”

What should my friend do now? Anybody knows a Higher official in Indiabulls, who could help? Or writing to RBI about this would help?

Please Help, Thanks, Surabhi R

What action I took ?

I emailed the whole incident as it is to Sucheta Dalal of Moneylife, who  helped in escalating the whole issue directly to Gagan Banga, CEO of the company . Moneylife got the reply directly from CEO within same day that he will look into the issue and by next day itself .

—– Forwarded Message —-
From: Gagan Banga <>
To: Sucheta Dalal
Sent: Sun, 21 November, 2010 1:31:12 PM
Subject: Re: Bad experince with Indiabulls Home Loans

Ma’am, this will be sorted out by tomorrow. Thanks for your feedback and for escalating this issue to me. Regards, Gagan

IndiaBulls had talked to the customer and apologized, they also handed over the refund cheques towards Pre-EMI & EMI the same day. They also dispatched Post dated cheque’s & loan cancellation letter to customer the same day. Here is a reply

From: “Gagan Banga” <>
Date: Mon, 22 Nov 2010 17:09:28 +0530
To: Sucheta Dalal

Subject: Re: Bad experience with Indiabulls Home Loans

Dear Ma’am, Firstly I would like to accept the mistake of my team and our system . We have already apologised to the customer for the inconvenience caused and handed over the refund cheques towards PEMI & EMI today. The remaining PDCs & loan cancellation letter are being dispatched today and should reach him in a day or two. Once again thanks for bringing this to my attention, such feedback will surely help us in improving our processes. Regards, Gagan

This was a reply made from Gagan Banga to Sucheta Dalal of moneylife and she forwarded to me later. Sucheta Dalal has been in journalism from last 25 yrs and its because of this fact that Moneylife has strong ability to reach top management. Moneylife has been helping investors like Ravikumar get justice from many years now and they routinely do grievance redressal with success rate of over 80%.  Moneylife also conducts various Financial literacy initiatives for common public in association with Industry experts .

Customer finally got Justice

After I got an email from Suceta Dalal that finally the issue is resolved, I personally talked to the Ravikumar (customer) on phone. Here is what exactly happened (as per the telephonic conversation)

Ravikumar went to Koramangala IndiaBulls office on Saturday (20th Nov) and the Manager-Praveen was not in office. One gentleman at office connected Ravi to Praveen over the office phone, and Praveen was not happy to talk with Ravi. He told that, today I’m on leave, will be back to office on Monday only, would look into then. There was nothing much to do for Ravi so came back home.

I think after that moneylife sent mail to Indiabulls CEO and he acted on it. On Sunday morning Ravi received a call from Mr. Praveen Pradhan (some other Praveen) , we claimed to the Location head of IndiaBulls in Bangalore. The other manager Praveen reports to this Praveen Pradhan. He might have received the communication from CEO by that time.

This Praveen Pradhan spoke to Ravi for 10-15 minutes, and collected the whole information about the story. He promised to Ravi that, he would receive money on Monday morning without fail. The interaction with Pradhan was pleasing and he apologised for the whole mess.

Monday morning (22nd Nov), Ravi visited Indiabulls office at Koramangala again, and he was directed to finance division. Straight away they have handed over the Refund-Cheque of Rs. 22,491 and as a latest update, while I was drafting this mail, some executive from Indiabulls called up and informed that he is coming down to our office in hour and would deliver the rest of the documents and those blank cheques collected.

– Ravikumar Govindanaik

Problem lies at Bottom level most of the times

This whole incident and what happened opens some questions . Is the problem mainly at lower levels or bottom of the pyramid which involves employees, and managers at lower level ? When we face any issues its never entertained by them or even customer care as they are just not bothered about the company ethics and only interested in their salary and day-to-day activities . However top of the management takes these issues very seriously and acts upon them faster ? What is your opinion on his point ?

Also what are your comments on this whole story ? Do you know some one who has faced these issues ? According to you, what can reduce these kind of frauds or un-professional behavior ?

You also make no mention of the fact that I told you in my email that Moneylife Magazine (www.moneylife.in) routinely does grievance redressal and that our success rate is over 80%.

5 mistakes I made in my first stock market Investment

Posted on by Jagoinvestor

Do you remember your first stock market trade and how you behaved at the time? Just like you, even I, have made some really stupid mistakes in stock market Investment.

Today, I would like to share some mistakes (only the big ones 🙂 ) which I made during my first trade in stock markets. Its worth discussing, how I could have avoided those mistakes. You can learn from them too!

investors mistakes

Mistake 1 : Buying on Others Recomendation.

27th Nov 2007 : I had just got my spanking new trading account and I was so eager to trade and make lots of money(How to start in Stock Market) .

I saw an Orkut community recommending GTC India – a “Buy” Recommendation. There were several good reasons discussed there, and an extrapolation on how it can reach from current price of 600 to 2000 in some months.  It looked like a “don’t-miss” trade. I bought 10 shares @ 560/-.

Mistake : Buying only on recommendation and not analysing the opportunity well, over relying on others recommendation, buying a company which I do not understand enough .

Learning : Never buy, just on recommendation! Do your own study and analysis. When you buy on others recommendation, you don’t take responsibility if there is any loss, which is dangerous in markets.

Hear others but listen to your self. See other factors like market trends, sector view, global markets, future prospects et al. Once you are fully confident that its a good trade and you feel comfortable with it… go for it.

Mistake 2 : Being too greedy

After 3 days : Just after I bought the shares, it went up from 560 to 800 in 3-4 days. I thought that its moving as expected, and bought 10 more shares at 800. Within another week, it went up more to 950! Now, I was flying!

I bought 10 more shares @955 again, to reach the target of 1500+ . My average buy price was now 772 . I was feeling little bad for not buying 30 shares directly @560 in the start .

Mistake : Greed! Pure & simple… This is a very common mistake, a big mistake at that – so big that it will be among the top mistakes investor and traders do. Buying more wasn’t wrong. It was the intention behind the buy. There is nothing wrong in increasing the position once it moves to your target, but it has to be backed up with strong reasons and study.

It should be a trade with high probability of success. In my case, it was not. It was just a recommendation from someone in an orkut community, with a couple of lines, explaining, why it will go up .

Learning : There was no need to buy more shares that point in time. I should have just sat back and watched. The Stock market is just like our life, you need to have a level of satisfaction in your life and stock markets.

If you want more and more and more, you might not get anything. In fact, you can lose heavily. Because of greed, I invested more than I could afford to lose. I took an unwanted and unaffordable risk, because I only saw profits and never the potential losses.

Mistake 3 : No profit booking on Time

After 1 week : The prices were not moving now. It was going up a bit then coming down again and was stuck in a range of 900-1000. It went up to 990 once. For a time being there was doubt in my mind if it will not move up to 2000 and will return back to my buy price levels.

Mistake : No profit booking. There was a sharp rise in shares price from 550 to 900 in just 2-3 weeks and that is rare. It doesn’t happen to every stock, it was an excellent return, but i did not book profits.

Instead of making the best of the situation and taking the (not so bad) profits, the market was offering me,  I wanted more and more and lost even what I was getting.  The reason was Greed, again.

Learning : The better thing to have done, was to book profits, at least partially… Situations change in markets, I never checked on any news regarding the company after i bought the shares, and I was never updated about it. Every time you get some good profit, its a wise idea to at least book some partial profits out of it (Unless you have really strong reasons to hold it for long) .

Mistake 4 : Having Ego

In next 1 week : Prices now started coming down. It came to 900 first, I was scared and told myself that I will book profits once it goes back to levels of 950+. It never did! Then it came back to 800 and I regretted not booking a profit at 900 and said to myself again “I will book it for sure when it comes to 850.”

Guess what? It never did! Then it went up a bit again and went up to 850 . I forgot my promise to myself & allowed my greed to take over my promise. It went down again after that and now it was near my average buy price. This was the time I was feeling, “What a big fool am I, for not booking Great profits!”

I could have sold it at 0% profit, & yet I didn’t, because I would look a fool in my own eyes. Why Stock Markets Attract and Look Easy

Mistake : Ego ! Fear of losing part of profits, another mistake was the fear of not making any profits and fear of losing some money . Fear! Fear! Fear!

Learning : “When your boat starts sinking, you don’t pray… just jump” Once you are doubtful, surrender to markets wish. See what markets are showing you, not what you wanted to see. Markets are supreme and no one can be smarter than the markets.

Leave your ego at your home, when you go in front of Markets. The markets tell you what’s going to happen, not vice versa. Accept that you are wrong and you made a mistake. Then move on.

Mistake 5 : No Patience

After few days : Then the prices started falling and plummeted to 600 (my original buy price). Now I was in loss. I was proven wrong, but I just couldn’t accept it. I kept trying to prove myself right by holding it and hoping it would come back up. Yea, you know… It never did 🙂 .

It went lower and lower and lower and I was just praying &  hoping that it’d return back to a level where I’d be happy to sell it. It never did! It went up to 300 and I sold it all in frustration. Then, I saw it go down to 250 and bounce back to 500! Now, I was feeling like I was cheated by the market for not giving me the right opportunity to exit.

Mistake : Impatience, Fear  and not cutting my losses short. I exited at a very bad time, at almost the lowest price then. There was an opportunity for me to exit at small loss, but taking a loss hurts the ego and it did. Not cutting my loss in time was the result, of my not defining my loss early enough.

I should have had thought of it earlier. Then, I’d just pull a trigger, when it reached that level, without emotions. Fear overtook common sense, Fear overtook logic .

Learning : I should have defined my Target and Losses before taking the trade. I should have been realistic and logical. I should have waited little mo.re time and then exited at a better price. I should have consulted someone, better than me (At that time though, even a street dog could have given a better advice than me :))

Price of GTC INDIA after this Incident : It never went above my price levels after that and went to Rs 55 after couple of months , even today (Nov , 2010) , its hovering below Rs 65 only .

Conclusion and Summary

My first trade was not at all planned and “no plan” is “a plan to fail”. Fear ! Greed ! Emotion! Ego ! Impatience! These are the elements of Failure in Stock markets. Manage them well and you’ll do better !

Real Story about an Investor who Fought for 9 months with ICICI Bank

Posted on by Jagoinvestor

Can you fight back ? Really ? If you were taken for granted as a customer by some Bank or any institution and you were forcibly sold some product by officials at some Organisation assuming you are a weak customer who will not raise his voice and fall in trap , What would you do ? Will you have the guts and energy for fighting back and getting what you deserve ? Here is a real life Story directly from the customer who faced lot of problems from his Bank when He wanted to shift his Home loan from One city to another . Lets see in this article in his own words and find out how Officials in these big banks take advantage of customers situation to make money for them selves . See other Force Selling Examples

How it all started

I have two home loans, one in Delhi and other one in Pune and I wanted to go for a home loan ROI switch (conversion of higher rate of interest to an existing rate of interest). My prevailing ROI was very high for both the home loans so wanted to reduce the ROI, of both, by paying the processing fees. ICICI bank has a process where-in one can go for ROI switch by paying the processing fee. First, I went to the Pune office, as I am in Pune, in March 2009 and then visited the Delhi ICICI branch in May 2009 for the loan switch.

  • March, 2009 : ICICI Bank, Shivaji Nagar, Pune – The  officials asked me to buy a ULIP of 40K for the conversion. They changed my loan account number and took all the documents again as if I am applying for a fresh loan. They also took 1 month to process my loan switch.
  • May, 2009 : ICICI Delhi – The customer care executive asked me fill an agreement on a 50 rupee stamp paper, took the switch fee and all the formalities were done in record 80 minutes. He did not ask me for any other paper and my loan ROI was switched in 2 working days.

Read the process in detail here.

The ugly truth

ICICI Pune branch has forced me to buy a ULIP and took 1 month for the switch procedure where as Delhi has taken 80 minutes. ICICI home finance Pune in collaboration with ICICI Pru is duping customers. ICICI Pru people are simply forcing their policies on ignorant home loan customers. This is how ICICI Pru executives are achieving their monthly targets.

Just imagine if I would have only one housing loan and that too in Pune, I would have been blissfully unaware of this racket. They must have done it with many home loan customers in Pune.c

The Confrontation

I sent my first complaint letter to  ICICI Pune, heard nothing for weeks. Sent many letters to all the 3 level of escalation as described on ICICI website, still no response. Finally, I complained the banking ombudsman (See How to complain to Banking Ombudsman) View the full complaint timeline Below .

The Result

Due to the Ombudsman intervention I got my 40K ULIP premium back, but ICICI evaded the answers of my other questions and no action was taken against the two officers involved. I realized that ICICI is capable of dragging this to eternity so I created this blog and uploaded all the conversation which I had/ was having with ICICI. My blog created a lot of noise and after 9+ months few senior folks from ICICI finally decided to extend the support.  Finally my queries were answered and Interest loss was credited back in my savings account. I was happy to find the answers but also sad as it took 9+ months for ICICI to respond. I have sent a letter of appreciation to ICICI in the same regard.

The Lesson Learned

  • Never trust any bank official as they have hidden agendas behind their suggestions and make it a point to read all the documents carefully.
  • Never do something which is being pushed upon, always take your time. Remember if they are rushing you and want everything today, take your sweet time and do a research.

How to avoid such scenarios

If you have been asked to buy a ULIP for any loan related process, use any of the method below to get back your money.

Option 1 :

Resolution Duration : 9+ months
Pain, mental trauma, stress and harassment : High

  1. Send ICICI a complaint mail with all the relevant docs photocopy (I maintained the correspondence on a blog which served dual purpose)
  2. Send a mail to all the three level of escalations mentioned at ICICI website – this is just a formality as u need to give a proof of ur complaint before sending a mail to Banking Ombudsman. dont expect anything from ICICI as it is a sheer waste of time but you have to do it.
  3. Now send a mail to ICICI ombudsman with all complaint letter attached. Make sure you provide the complaint in the desired format.
  4. Send a mail to ICICI Pru Bombay, thru post and online, the ICICI Pru is very fast in resolving any dispute.
  5. Keep sending stinker mails to ICICI, well they not budge but you will feel good and light

Summary : Online blog will help u maintain the flow of sequence and the best part is that u will learn how to blog :-). Keep on following and one day someone will respond, in my case it took them 9+ months…..

Option 2:

Resolution Duration : 15 days to 1 month max
Pain, mental trauma, stress and harassment : NIL

  1. Go to the bank and agree to buy the ULIP in return of you loan related process.
  2. Give them ULIP premium cheque, get a photocopy of the ULIP docs/forms and the check.
  3. Take the visiting card of all the people who were involved in ur case (this is very important, if no visiting card atleast take their name, designation and mobile no.)
  4. Ater u have agreed to their demand of ULIP now make sure you get ur work done ASAP. Don’t give them any time get ur work done at the earlier. Be firm and be rude.
  5. Wait for the ULIP welcome kit
  6. Once you receive ur ULIP welcome kit, write a strong complaint letter to ICICI Pru telling them about the forced ULIP, the names of the people involved and your request of cancelling the ULIP. In all the insurance firms there is a freelook period of 15 days to 1 month during which u can refund the policy without providing any reason (but you must cite your reason in this case).
  7. Make sure your complaint mail is very strong. ICICI don’t respond to polite mails, they simply ignore them.
  8. Your ULIP money will be refunded.

Summary : This is a very simple way of getting ur work done smartly by complying to all the stupid rules set by ICICI or any other bank for that matters. Just agree to their demands and cancel the ULIP during the free look period.

Good luck and have a safe banking .

How Much Home Loan can you afford (please vote , Data will be used for future Article)

Comments , What do you think can be done to avoid these situations ? Are you aware of any thing like this in your real life ? Lets share our views on what are the different preventive and corrective measures which can be taken to avoid these kind of situation . Dont forget to praise the efforts made by this Guest 🙂

Note : Though utmost care has been taken while taking the information , Jagoinvestor do not take any responsibility about the information provided above.

Mis selling by an LIC agent

Posted on by Jagoinvestor

Many people have been sold LIC policies without making them understand what is that policy and how is that structured for you.

I have recently been informed by one reader how an LIC agent sold her a policy claiming it to be “a great opportunity” and gave her wrong information about the policy and the actual thing was totally different, which she discovered from another LIC agent years after.

Now the situation is a total mess. [Written in Train, Posted from Home]

mis-seling

Mis-selling from an LIC agent

Hello manish..

I have been taken for a ride by a cheating “char so bees” LIC agent. Please help me. In 2006 I got married and moved in with my husband to a very remote mountainous region. Soon we had a Lic agent pestering my husband about taking a ” good” life insurance.

I had read in a Readers Digest issue about term insurance and asked the agent about the same. But that shameless fellow said that such a thing was not available in LIC.

Since he was the most “renowned” agent, I trusted him and took the next best thing he offered – a 22 year 16 lakh money back policy Jeevan Anurag in which I would have to pay Rs1.21 lakh per annum for 7 years after which we would start getting money back( Rs80,000 in the 7th, 8th, 9th, 11th, 12th, 13th, 15th, 16th, 17th, 19th, 20th, 21st year and 3, 4, 5, 9 lakhs in the 10th,14th,18th,22nd year).

He also said that our as our policy got older we would have to pay less premium. I did’nt quite understand when he gave us 4 policy papers and questioned him about it on two occassions. But he asked us to trust him and ” reap the benifts of this incredible policy”.

I had my doubts but I was naive and did not want any trouble. 2 months back we got transferred to a more” civilised” town and soon we had a new LIC agent knocking our door. As we talked about my previous policy this new agent said that he has never heard of such a policy and asked to see the papers.

I was dumbfounded when the agent told me that I dont have a 16 year policy but 4 different policies of 4 lakhs each for 10,14,18 and 22 years of which the premiums are Rs 46032, Rs31842,Rs 24355, Rs19357.

Jeevan Anurag provides the following assured benefit-“..an amount= 20% of of basic SA at the start of the year during the last 3 years before maturity shall be payable . At maturity balance 40% of basic SA+bonus…”.

That cunning man had arranged the policies in such a way that when one reached maturity the other just stared paying up. I feel so stupid for having been duped. I have already paid 4 premiums(4.9 lakhs)…

now I am in such a state of confusion that I dont know what to do next. Should I discontinue or should I continue ???

I see a lot of sense in what you say and I would really like to invest into some of your ideas but my money is stuck and I dont know where to go from here..Where I live the only financial advisor available is the LIC agent and I dont trust a word he says so please show me a way out.. I really need your help.

And is there a way I can get back at that sleazy agent? Help?? please..

Read the review of Jeevan Tarang Policy from LIC

Answer

oops .. that really hurts ..

I can see that you are mis-sold the policy , The returns which you mentioned to me also looks little cooked up , please check the numbers once again , if needed involve that new LIC agent to find out what is the exact money you are going to get back in different years .

If you have 4 lacs policy for 10, 14, 18 and 22 years, then that 80k figure is correct. but looks like the 3,4,5,9 lacs thing little cooked up . you should be actually getting 1.6 lacs + Sum assured in each 10th, 14th, 18th and 22nd year.

Looks like this has overestimated the sum assured part and made it 3,4,5 and 9 lacs, This might happen but the probability for that is close to 0. Ask the new LIC agent to estimate how much is it…

My estimate is not more than 2.5 lacs in each 10th, 14th, 18th and 22nd year. max 3 lacs… Apart from this the premium of 1.21 lacs is to be paid upto 7 yrs, that is true, but after that, only the first premium will stop, the other 3 will continue and then 2nd will stop in 10th yrs .. and so on.

As you can see from https://www.licindia.com/children_need_001_benefits.htm that the premium stops only at n-3th year of a policy . Please try to understand the policy yourself.

Truly speaking, I am more mad on you guys than that LIC agent

Regarding tracking down that LIC agent , you might have phone or address or some sort of contact . If not , Contact LIC and find out your LIC agent name and agent number or something . File a complaint with LIC on this matter and once its not taken care within 2 months, file a compaints with IRDA on this .

Take this matter to consumer court . I am giving all these suggestions but not sure if this will be of too much help , because you guys have signed the document which says “I hereby understand and agree with Policy Document and am responsible for all the invesment decision” , Hence I am raising my hand to help you but fingers are crossed .

Apologies if I my words sound little rude , but I am an emotional person .

Comments

What do you think about this issue, Do you know how to track that agent again, Anyone can help this person? Contact me…