RCA Issue Reported and Sequence of Events (19th June)

The Investor had placed a redemption order in Parag Parikh Mutual Fund on 14th June 2024 which was rejected by the AMC with remark “Invalid Folio Number”.

The Investor reached out to our customer support for clarification.

On checking with the CAS of the Investor, we found that the Investor had originally, on September 25, 2020, invested Rs. 10,000/- through a bank mandate linked directly with BSE (ISIP). The presentation of such SIPs are processed directly via BSE. The Order ID for this transaction was 1XXXXXXX6.

On June 27, 2022 in the RTA reverse feed files that we consume, there was another transaction of Rs. 50,000/- for a different folio but with the same Order ID 1XXXXXXX6.

As a result, when the file was processed in our system, due to the same Order ID the original transaction of Rs. 10,000/- was updated to Rs. 50,000/-.

This resulted in an inadvertent additional units displayed in the investor’s portfolio. The same was later corrected and informed to the investor.

During the conversation, the Investor was asked to share any records of the debit of Rs. 50,000/- in her bank account towards investment in this folio on the said date, which we have not received yet.

We have also received confirmation from BSE that no debit has happened in the bank account of the investor w.r.t the claimed amount.

Meanwhile, we have also thoroughly checked our bank records and confirmed that no such money was received from the Investor on the said date.

Root cause of the problem

Our systems consume reports from both, the exchange and RTAs, to update and reconcile Investors’ holdings report. The unexpected duplication in the Order ID resulted in a discrepancy in the holdings of the Investor, where the order initially valued at Rs. 10,000/- was incorrectly displayed as Rs. 50,000/-.When the Investor tried to redeem these extra units (which were not invested by the Investor), it resulted in a failure.