HKMA investigates complaints of alleged mis-selling of investment products

HKMA investigates complaints of alleged mis-selling of investment products related to Lehman Brothers

The Hong Kong Monetary Authority announced today (Monday) that, up to 3 October 2008, it had received 5,567 complaints from retail investors alleging improper selling of investment products by licensed banks. In 4,205 cases, the HKMA had received the initial complaint and assigned a complaint number to facilitate follow-up action. For a further 1,250 cases, the HKMA was calling back the complainants to obtain further details and confirm the allegations. The HKMA had already assessed 112 cases to determine what further action is required and had opened investigations into 22 of them. In 7 cases, insufficient evidence of mis-selling had been found, while further information was being sought in the remaining 83 cases.

Mr Joseph Yam, Chief Executive of the HKMA, said that the role of the HKMA is to investigate complaints of mis-selling against banks. "The HKMA is dealing with the complaints as quickly as possible. It is, of course, very important that we do this objectively and without pre-judging the issue. If, after investigation, we find cases of mis-selling, we will treat them very seriously.

Mr Yam added "The consideration of complaints entails a heavy workload and is time consuming. We have mobilised about one-third of the staff of from the three banking departments in the HKMA and have employed temporary outside help. We are also making arrangements to bring in additional staff. At a time when the banking system in Hong Kong is under some externally induced stress, requiring much closer attention by banking supervisors, there has obviously been some pressure on resources"

Mr Yam stressed "We sympathise with investors who have been affected by the collapse of Lehman Brothers. Our priority now, is to consider the complaints as quickly as possible. Within the authority of the HKMA, this is the action that will be most helpful to the aggrieved investors. "