October 13, 2008: 03:26 AM EST
HONG KONG -(Dow Jones)- Hong Kong banks came under fire Monday from lawmakers who accused them of playing down the risks of structured products backed by Lehman Brothers Holdings Inc. (LEH) that were sold to thousands of small investors.
The investors lost millions of dollars when Lehman declared bankruptcy last month and many have been protesting in the streets as officials look into the matter.
In an emergency hearing on the crisis, lawmaker Cyd Ho accused bank managers of pressuring staff to sell the products quickly, by playing down risks to customers.
BOC (Hong Kong) Ltd. (2388.HK) and DBS Bank (Hong Kong) Ltd. pledged Monday to compensate customers if they found any wrongdoing occurred, as the products, known as "mini-bonds," were sold to retail customers. "If we find there was any wrongdoing during the sales of structural products, we will be responsible and compensate the customers fully," DBS head of consumer banking Linda Wong told the lawmakers Monday.
BOC (Hong Kong) head of personal banking Lawrence Law said the bank was willing to compensate customers "but needs to look at the cases on an individual basis."
The Hong Hong Monetary Authority has received 9,281 complaints from investors and said last week it was investigating sales of the structured products by nine banks. HKMA officials said they might also consider whether retail banks should be stopped from selling such products.
http://money.cnn.com/news/newsfeeds/articles/djf500/200810130326DOWJONESDJONLINE000106_FORTUNE5.htm
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