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Rights of a nominee over mutual funds


07-Dec-2023 (In Family Law)
We are hindu undivided family. My brother is not married now. He has invested all our family money in mutual fund in his name only and kept me as nominee. Now he is getting married. If my brother dies after marriage ,can his wife claim all the money that is in mutual fund in court. Since I am just a nominee and not there as joint holder can the court say that all mutual fund money will go to my brother's wife after his death since he is the single holder now. Thanks
Answers (3)

Answer #1
784 votes
Dear Sir, After getting married if your brother change nominee name only when you are not able to claim (i your brother die). if your brother doesn't change nominee name and die then you can claim.
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Advocate Minu Sinha

Adv. Minu Sinha

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Answer #2
898 votes
Dear Client, Yes, since Nominee is regarded as a trustee. The Nominee has only right to receive and not to own the proceeds. It is the legal heir who are entitled to own the proceeds. Hence, the nominee has a right to receive the proceeds and later distribute it as per the will or if will is not left, then asper sucession law prevelent in the country. Finally, it is the legal heir of the deceased who will own the proceeds.
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Advocate Kumar Karan

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Answer #3
846 votes
It's general perception that nominee becomes the owner after the death of the nominator. Nominee is only liable to receive the money in order that the same may be distributed among the legal heirs as per the personal law concerned.
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Advocate Abu Bakar

Adv. Abu Bakar

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Disclaimer: The above query and its response is NOT a legal opinion in any way whatsoever as this is based on the information shared by the person posting the query at lawrato.com and has been responded by one of the Divorce Lawyers at lawrato.com to address the specific facts and details.

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