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Letter to BS: CG Power financial fraud poses risks for mutual fund industry

Audit reports don't reflect the true state of the financials and the credit ratings are unreliable

Business Standard 

Power line

This refers to “CG Power fraud stumps mutual funds” (August 22). Post demonetisation, with the real estate business in the doldrums and investment in commodities unattractive, most investors have shifted to financial assets. But for the past two years, every day there is news of companies/banks failing or in serious problem — public sector banks, IL&FS, the Anil Ambani group of companies, DHFL etc to take some examples. Investors have put in their hard earned money in mutual funds, NBFCs, corporate FDs etc but there is bad news every day from financial institutions. Audit reports don’t reflect the true state of the financials and the credit ratings are unreliable. Retail investors are getting singed by these unending problems. What is a retail investor supposed to do? Keeping grinning and bearing it?

Arun Pasricha, New Delhi

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First Published: Thu, August 22 2019. 20:53 IST