Tan Kin Lian's Blog: Appeal to Financial Institutions

Friday, October 17, 2008

Appeal to Financial Institutions - settle through mediation

I appeal to the financial institutions to act honorably. If your sales representatives have made a mistake and have given the wrong advice to the retail investors on the credit linked securities, please step forward and offer to settle this matter through mediation.

You can buy back the securities from the retail investors at a value that is higher than the current market value. Your institution will be able to hold the securities to the maturity date and realise a better value, compared to the current value. You will be able to minimise the loss.

You should also be prepared to offer more than the current value as your institution should bear some of the loss, due to the failure to advice the investors properly about the actual nature of the product or the risk.

I am willing to act as the mediator to get the investors to agree on a fair settlement, where both parties should share the loss fairly. Most investors are willing to take a cut on their original investment.

I suggest that the amount to be paid can be the current value plus half of the difference, i.e. the investor and distributor share the loss equally. If you like to consider this approach, please send an e-mail to kinlian@gmail.com.

27 comments:

Anonymous said...: 50 to 80% is unfair to invester if they can prove they are mislead, they should get back 100% plus interest; October 13, 2008 5:32 PM
Anonymous said...: Good proposal Mr Tan. Speaking to teh RM & representative from the FI's Investor Care Services, it appear to me that they do not know the product.

I have received a letter from the FI advising that "... it would take several uunderlying entities in the collateral to suffer Credit Events before investors suffer a loss to their principal amount" and yet when only 1 reference entity (Lehman Brothers) out of the 8 reference entities failed, we were advised that we may suffer loss on the entire principal amount.; October 13, 2008 7:32 PM
ph he said...: Mr. Tan I fuly agree. The distributors and their RMs should admit their mistakes, especially those RMs who sold the structured products without any product knowledge at all. But sadly, I doubt if there are such honorable institutions and people around these days??? However, we must persevere, stay united and uphold justice!; October 13, 2008 9:15 PM
Anonymous said...: Some folks really don't know where they stand. Can lose 100% of their capital, yet die die want 100% plus interest. If you can even get back 20% you should be very thankful already.; October 13, 2008 9:56 PM
Anonymous said...: i don't think it is unfair. I fully agree that both investors and the bank should share the loss together..

when we signed the dotted line, i believe most of us know there is some risk involve in comparing to fixed deposit.Except that we didn't know the risk is so high

i would be happy if can get back 80 percent of the capital.; October 13, 2008 10:00 PM
Anonymous said...: Mr Tan
does this also applies to HN5, cos' understood that the fund was fully redeemed? Watch 9'clock news, appartently DBS has mentioned that if investor can proof that they are mis-led, they will be most willing to bear full responsiblilty. They jolly well know that is much easier to "proof" that there is "no" Mis-sell as we have indeed signed on the dotted lines with those fine prints. All these are done on verbal conversations between the RMs and all the investors, if we have so called concrete proof, then this saga will not drag till now! So their commitments is as good as issuing a blank cheque!; October 13, 2008 10:38 PM
Anonymous said...: Kp,agree no concrete proof as we will make to sign numerous unexplained forms in their favour only.; October 13, 2008 11:34 PM
Anonymous said...: I was saying if you can prove they they have mislead you using a written evidence or you got a recording of they misleading you, you should get back 100% plus interest. But if you cannot prove anything, 80% is a lot.; October 14, 2008 12:39 AM
Anonymous said...: Since DBS is willing to look into compensation case by case, shouldn't MAS try to 'ensure' that the rest of the banks follows suit? At least, it would give helpless investors a chance.....; October 14, 2008 1:33 AM
ph he said...: I have a chance to speak to a very senior executive of a bank recently about the incompetent of the RM such as mis-selling structure products and bad advice. However, he was very 'protective' over the RM even though I presented him with evidence. The senior executive gave me the impression that he only has his bank interest at heart, making sure that investors like us cannot find fault with the RM, thus ensuring that we cannot lay any claims against the bank. This is how the banks bully us at all times!; October 14, 2008 1:49 AM
siewkhim said...: Big organisations, powerful andrich people and government and the likes, bully people all the time since the days of Adam and Eve.

Similarly people from the tea lady to the Chairman and CEO who work for these big organisation and the members of the ruling party that run the government are paid and are told directly or indirectly to have the interest of their organisation first.

Look, these are very natural consequence of the ego of the creatures called human beings.

When Kin Lian was the CEO, ask him how did he behave when disputes like this arise. Same lah!!!!!; October 14, 2008 1:46 PM
Anonymous said...: I think this is a good suggestion.See no point in going thru' all the trouble cos' those big boys to fight the case for them.; October 14, 2008 4:06 PM
Anonymous said...: It seems that Mr Tan is putting the cart b4 the horse by assuming that bank RMs had somehow misled customers into buying minibonds and High Notes. If the banks really have to share the loss with the minibond investors, then eventually I believe taxpayers, directly or indirectly also have to bear the loss too?? We know that Temasek & GIC have stakes in our local banks as well.; October 14, 2008 4:47 PM
Anonymous said...: Too bad if tax payer's money is involved. You should go after the trustee of your money for putting it in the wrong place.
What do you Mr. Tan put the cart before the horse? Isn't the RMs the horses drawing the cart? Aren't they the ones who dealt with the Ah peks and old folks and conned them?Do you know miss-selling and misrepresentation are tantamount to cheating? To mislead and cheat.
You should stop Temasek from investing in citigroup> and pay these people. It is not even one billion.; October 14, 2008 11:04 PM
Anonymous said...: We are all here to explore ideas and try to help the helpless and not 'fool' around.

Please do not try to make fun at the expense of others!; October 15, 2008 4:19 AM
Anonymous said...: It's nothing unfair to ask FIs to compensate. They deserve it. As a matter of fact, it is the FIs who bet and lost money, but these saga were trying to trick the innocent common people to buy the bills for them.

So, tax payers and shareholders, if you want, you should scold the the irresponsible FIs that are losing your money.; October 15, 2008 10:12 PM
Anonymous said...: I fully agree with Mr Tan that this is the best option for the investors. But who can get the FI to form a consortium to buy back the securities . Perhaps only MAS can do so.; October 15, 2008 11:04 PM
Anonymous said...: The Chief Executive of HK Government today demanded the banks to reply within this week whether they are prepared to buy back at market value. He said this matter has dragged on for too long, and that we must deal with it very seriously, that what initially appeared to be nothing more than unfortunate investment decisions has during investigaion turned out to be clear indication of problematic selling practices by banks. If banks and investors cannot settle, the government said they will use public fund to help investors sue the banks. Commercial Crime Bureau of the police are taking statements by victims (I gave mine) for possible criminal prosecution. The Monetary Authority will within days announce and rebuke the first bank investigated. More disciplinary actions to follow.

In short, we are not going to compromise. If some people believe they share some of the responsibility, of course they should settle. But if anyone believes they were cheated, why compromise?

The statement that "any investor should know there are always risks with any product, and therefore must take their own responsibility", is inane. There are always risk no matter what food we eat, but we sue companies who make posionous food.; October 16, 2008 2:12 AM
Anonymous said...: I have the same letter that says "... it would take several uunderlying entities in the collateral to suffer Credit Events before investors suffer a loss to their principal amount"

If you agree to take anything less that 100% of your sum, do understand that you have weaken your position before the negotiation starts. Is this a wise thing to do? Your call.

Not Anonymous.
limfangwu at gmail dot com; October 16, 2008 9:19 AM
Anonymous said...: I do agree that investor bear some losses, particularly in notes where Lehman Is part of the RE; for eg:Jubilee S3.
However, for Minibonds, it is obviously a case of misled, as I don't think any adviser told the investors in regard to the risk of arranger going bankrupt. Those FIs are very defending and I doubt the so call "interviews" are helpful in anyway.; October 16, 2008 11:45 AM
Anonymous said...: Singapore, our nation, expires to be the wealth management centre of the region. To investors, Integrity, reliability transparency, leadership and professionalism are among the key performance indicators any investors will judge. From the recent turmoil, investors might have already formed the opinion that Hong Kong's financial leadership has taken a more decisive and effective approach in handling the crisis in giving 100% guarantee to deposit and taking responsibility as well as its determination in resolving the minibond issues which affected many retirees. Wealthy investors, particularly the mainland Chinese will be one of the key markets Singapore wants to attract and we cannot allow it to slip away to Hong Kong which may be now perceived to be a preferred destination. Our institutions have to do something effective before it's too late.; October 16, 2008 3:03 PM
Anonymous said...: In cases where the FIs had misled investors into buying the structured products, it is only fair that the investors get back 100% compensation because misleading and mispresentation amounts to cheating, the FIs must bear the full consequences of their actions.; October 16, 2008 7:25 PM
Anonymous said...: Mis-sell is a serious offence. If investor can't get back 100%, the rest will be even bold to sell anything to their customers.

Supermarkets can sell wine but in the end turns out to be vinegar. When customers go back for refund, supermarkets will only give them back 50% as supermarkets will claim that they did not know the wine turns out to be vinegar. Is this fair?; October 17, 2008 2:05 AM
Anonymous said...: Buying financial products which run into millions of dollars is not like buying vinegar. Investors out there should be realistic, if Mr. Tan can help us to nego and get back 80% of our money we should all be grateful. There is no end to the argument about what is fair because nothing is fair in this world to begin with. The 20% of loss we can treat it as a very expensive course fees and a lesson learned. Please be united and push for a swift settlement.; October 17, 2008 10:29 AM
Anonymous said...: I think all this anxiety and differences of opinion is really moot. It all depends on what the current value is, right? What if the curent value is just 10-20% of what you invested? Do you think it is still fair? On the other hand if at the end of all the valuation and calculations, you get back, say, 80% then that is something to be considered.

But DBS (and the other banks) should still be fined heavily by MAS!!; October 17, 2008 11:04 AM
Anonymous said...: Dear Mr Tan,
Looking at the way Mas is 'moving',investors are going to lose everything.Why don't we gather all those investors who wanted to take collective action and get going. Mas is NEVER going to help us, why don't we help ourselves.I'm sure we should be able to garner thousands of"YES"; October 17, 2008 5:52 PM
Anonymous said...: siewkim,
you have maligned Mr. Tan by alleging that he would do the same.This is insinuating that he has double standard.
I refute your statement.
When he was ceo he had on many occassions compensated the aggrieved policyholders when it was clear that the agents were guilty of misconduct.
Another occasion was when the guaranteed fund changed course in its investment mandate because of the 911 Mr. Tan was so concerned that he allowed policyholders to switch without the upfront charges. In other words the company borne all the costs. I think all the policyholders were happy.
These examples clearly show Mr.Tan isn't what you think.Please don't be suspicious . He is doing all this out of a compassionate heart.
Maybe you have been screwed up by Income's agents and you are taking it out on Mr. Tan. I know Income's agents are screwed up agents , greedy and unqualified lots. If you have reported them to Mr. Tan he would have censured them. Anyway he is no longer helming the company let us support him in his service to these people.

I support Him; October 17, 2008 8:28 PM