Friday, October 31, 2008

Petition #4 - Review Complaint Handling Process

This Petition is addressed to the chairman of the Monetary Authority of Singapore and ask MAS to review the complaint handling process. Specifically, it ask:

1. That the Monetary Authority of Singapore appoints or sets up an independent unit to receive the complaints and to provide assistance to the complainants to write their statement.

2. That the Monetary Authority of Singapore encourage the financial institutions to adopt a collective approach in offering fair compensation to investors who have been misled into investing in these unsuitable investments, according to the category that the investors fall under. These categories could, for example, be determined by the manner in which the investors were advised or approached by the sales representative, or the alleged mis-information given to the investors.

You can click here to read the full Petition and sign it, if you agree with it:

http://www.petitiononline.com/PRCHP1/petition.html

114 comments:

Anonymous said...

Dear Mr. Tan,
Can you include both categories of investors that is those that bought from banks and finance companies mainly vis the RM and those that bought from the brokerages via the newspapers advertisement.

Otherwise a large numbers would not be able to sign the petition.

Anonymous said...

Thank you Mr. Tan.
You have done a lot for us w/o any compensation. You are such as selfless person.
We really appreciated it.

Tan Kin Lian said...

I have revised the wording of the Petition. Please submit now.

Anonymous said...

Dear Mr. Tan,
Many were misled because we thought the money were invested in "AA" rated "bonds" which are very safe. Just imagine some countries (as a Ref entity) only has a "B" or "B+" rating. If they are truely "AA" rated, then they should be very strong.
Could you amend your wording slightly to reflect this fact?
Thank you.

Anonymous said...

Dear Mr Tan,

This should be the last petition. If there is still no constructive actions from MAS after this petition, we shall report the case to CAD for justice.

Anonymous said...

In today ST, there is an article from a NUS Business Professor that mentioned that the minibond is so complex. What chance does MAS and the retail investors have in understanding the product?

Anonymous said...

Many were misled by RMs. RMs didn't conduct a fact finding but push the products. MAS should know of the danger of this way of selling.
If MAS is sincere it should make it a must for all RMs, including consultants and insurance agents to conduct an analysis before recommendation of the products. MAS should ban product pushing and selling.

Man of Ideas said...

Dear Mr Tan,

I have followed your petitioning in the media, and I must say you have done a GREAT job!

Anonymous said...

The evidence of mis-selling is very clear by now. If the FIs still refuse to compensate us fairly, we shall all lodge our cases to CAD. MM Lee said Singapore is governed by World Class Government with A-team leaders, we believe justice is not dead in this world class country.

Tan Kin Lian said...

Hi 9:49 AM

If you are tired of signing petitions, you can ignore it. Leave it to the others to decide if it is worth signing.

Anonymous said...

Dear Mr. Tan,

I appreciate your selfless leadership in helping the aggrieved investors to find a resolution to salvage their life savings.

Most of the focus has so far been on the investors categorised as "vulnerable". Based on their profile, I fully they are most deserving of all possible help to get them out of their dilemma. However, looking at the structured notes/bonds as a whole, there is certainly a case to be made about mis-selling by the issuers and the distributors. The "all-or-nothing" feature of credit events which seems to be common in all these notes is something which, among others, came as a big shock to all groups of investors and the risk impacts were not adequately or clearly explained in the selling process. In retrospect, the promised returns on these notes, while higher than normal deposit rates of similar tenor, are not high enough to have been perceived by the investors as fair compensation to take on the risks that are now hurting and destroying the value of these notes. In fact, these notes on hindsight are not even investments in the normal sense of the word. They are actually risk-underwriting which BET on equity prices and the credit viability of selected companies. And to the shock of all, these notes are not even backed at all but real investments/equities. If indeed these are gambling like in casino, why did MAS cleared them for the men in the street to be engaged in without the same kind of care and warning that the government has exercised in casino gaming. Why are men in the street even allowed to be in the business of risk-underwriting of OTC (over-the-counter) derivatives which are hence not listed in the stock exchange. Why were the notes allowed to be lodged with CDP as custodian. This definitely further misled the investors on the credence of these notes. To aggravate the matter, I do not think even the professionals engaged in the creation and distribution of these notes really understand or know the complex valuation of the risks and the investments.

The present case-by-case interview process by banks and FIDREC is very slow and is mostly for the "vulnerables". It will be even more complex and time-consuming when it comes to "non-vulnerable" investors as there will expectedly be contentious issues when determining fault. With some 10,000 investors in sufferance, and with the limited and slow process of independent adjudicators like FIDREC, it is impracticable and unrealistic to expect to be able to otherwise resolve all the cases in an orderly and timely fashion. It could well take years.


All said MAS, whether it admits it or not, is a stakeholder in this SYSTEMIC debacle. I suggest that you include in the petition to MAS a request for MAS to exercise moral suasion on all the financial entities involved to provide a settlement package to all investors on a shared-pain basis which can bring a quick resolution for most if not all.
I will therefore like to suggest a package of sort, which may be further modified, that will include the financial institutions providing to investors of the Minibonds, Pinnacle Notes, High Notes etc:

1) A full refund to all "vulenerables" and "non-vulnerable" investors of all the fees, charges and commissions earned by the financial institutions on these notes, plus

2) Underwriting, say, one-third of the principal value of these notes held till maturity, or buy over these notes outright at an agreed price. Individual investors will have the option to choose either one. Anyone who finds none of these to be acceptable can instead take their own action.

3) The financial institutions may still negotiate with "vulnerable" investors on a resolution which is more favourable than the above on the merit of each case.

We must impress upon MAS that to maintain the standing and orderliness of Singapore as a key financial hub and a wealth management centre, the protection of the interests of investors is as paramount as that of the financial operators. Invoking caveat emptor as purely the legal route is to leave investors to the risks of survival in a financial jungle where the financial institutions are the sharks, or so to speak at the head of the food chain.

Anonymous said...

11.17am,
not only RMs mislead their customers the inusrance agents especially those at roadshows too.I was passing a pasar malam stall roadshow operated by ntuc agents i was stopped adn the agent immnediately went into a non stop presentastion on their product Revosave and telling alot misrepresented faeatures of the product. I already heard a lot about this rip off product which does nothing at all for you. Its cashback return is much lower than the bank interest rate. Why on earth would anyone want to save a in a stupid product which is riskier and lesser than a bank deposit? Whe I questioned the agent she had no answer to my question. She didn't even know the return. I asked her to calculate but she couldn't. How could a senior financial consultant not able to to do that. It is msirepresentation of her self as a financial consultant when she wasn't fit to be called one. She misled the customers by her title and she turned out to be only a product pusher and very bad at it.
MAS must stop all this before another kind of consumers get cheated by insurance agents who push misleading and dubious products to unwary members of the public. Worse, these products are complicated too and the man in the street will not know the toxic only after years down the road.
No wonder i heard a lot about ntuc agents being the super dupers of products pushing and the top agents are exceelent and best at it. MAS must get rid of product selling before more consumers get hurt by predators who have no intention of adding values to their customers but commission for them so they can qualify for mdrt and other incentives. MAS should audit these people for mis-selling and misrepresentation. I am very sure they committed these malpractices.
Stop them now before nother bomb of another kind hit the conusmers.

Very concerned Singaporean

Anonymous said...

It seems that Singapore enjoys matters which brings glory to the country such as winning medals at Olympic, Paralympic, the separation of the twin girls' and the twin sisters' Pedra Blanca case rather than such issue that involves MAS, the government body. She should once and for all settle this and move on. In doing so, it would win the heart and understanding of the people who would then have the confidence to invest again. Going forward, I doubt many people would dare to invest in any products.

Anonymous said...

I honestly think that it's good to continue to send our intentions to the authority by means of a petition. History (just the past few weeks) says that they are responding to the petitions, both MAS and the FIs. In Petitions, we see ourselves uniting and this is a force that can make things happen. I would sign as many petitions as I need to get justice and a fair compensation on this.

Anonymous said...

Thank you Mr Tan for your care and concern for all affected investors. We should aim for collective/class action and press MAS for collective/class solution. Investors should not fall into the trap set by both MAS and financial institution to seek individual solutions to individual cases. Without collective and class action and pressure, it will lead to unfair and divisive solutions. In Hong Kong, the investors acted collectively and got some concrete results and of course the pressure through public demonstrations and many political parties help to achieve more meaningful outcome than in Singapore. Mr Tan, you are our hope in redressing this mess and investors should therefore rally around you as a collective and united group, not divisive and disunited.

Anonymous said...

Mr Tan,

Please also make special mention of JUBILEE 3 in your petition. That MAS review FI's speedy investigation and compensation; and MAS review whether HSBC Trustee acted on BEST INTEREST OF INVESTORS.

JUBILEE 3 is not getting the ATTENTION it warrants from the Authorities or FIs or Press. This is the 1st product to declare ZERO VALUE - and how MAS handles the investigations will SET A PRECEDANCE for other products.

Thank you.

Anonymous said...

Mr Tan,

I concur with you that the only way to push the higher authority into some actions is to send them wave after wave of petitions. There lies your leadership that we are all grateful of.

Anonymous said...

Product selling or pushing is considered mis-selling and misrepresenting. RMs who ticked "product advice' option in the KYC had likely committed these unethical practices and breached section 27.

Anonymous said...

I dont understand why the petition 2nd para which said, we were not informed that these securities were high risk...
To increase the objective goal of facts only and cut out emotional words, is it not better to just state that.. we were not informed of a critical fact for us to evaluate the product, which is, when one entitity failed the entire capital may be lost.
We need to give some breathing space for the banks and give them some face. Which bank will openly admit that..sorry yes i forget to tell you it is high risk product. Let the facts speak for themselves. Relation Manager should give critical facts to investors during selling to avoid misunderstandings. On the other hand, Investor has to take and share some responsiblity to assess the risk this is a more balanced picture which the bank may find easier to swallow.

REX

Tan Kin Lian said...

Hi 4:42 PM

Jubilee Notes is mentioned in the Petition.

Even if it is not mentioned, the Petition addresses all the structured products that are affected by the alleged mis-selling.

I urge the Jubilee Note investors to lodge a complaint on mis-selling to register your grievance.

Anonymous said...

Actual number of signature on petition is DOUBLE of the list submitted.

Assuming half the affected investors are chinese - educated and never go to Englich version internet. There is no way for them to join the petition.

Let's say, , there are 500 peple sign on it, it implys that 500x2= 1000 signatures , including those China- educated

Anonymous said...

The only solution of this SAGA is to ask MAS pass the message down to ALL distributors to set general guideline for compensation.those are not happy can continue to take legal action later.

Some buy from broker firms, the firms can argue that we send the brochure to you and you can decide not to buy. firms are only the distributer.

We , singaporean always have this in mind, the FI dares to send such brochure to customers,the product must have been approved by MAS and safe. The product advertisement on newspaper is so BIG. It should be safe , espectially ,series by series continously, it should be safe.

Anonymous said...

Dear Kin Lian,

MAS managing director Heng Swee Kiat is reported [Sunday Times, Oct 26] to have said, inter alia, ... "This group should have understood the risks of investing in these products and take responsibilities for their actions". Mr Heng, what about emphasizing: "Any bank or institution that has mis-sold or misrepresented must bear the loss suffered by the investor" Would Mr Heng consider that producing an advertising pamphlet containing statements/advices such as:
"Invest on solid foundations and earn 5% pa paid every 3 months for 5..years" and "With our Minibond Series 3 credit-linked to six major financial institutions, you can enjoy the returns you deserve with peace of mind" misleading - notwithstanding a disclaimer clause, in almost illegible fine print somewhere at the bottom of the pamphlet?

When the institution responsible for this advertising pamphlet instructed the investor to sign on an A4 size pamphlet, the investor was not informed that the pamphlet produced for his/her signature was NOT the same as the advertising pamphlet distributed for public consumption. Certain words/phrases were crucially expunged from the A4 size pamphlet that investors were instructed to sign. This institution can be clearly seen to have acted with deception, with a preconceived intention of misleading the investing public, particularly where the adverts between the two pamphlets differ in content.

To Mr.Heng: if MAS is serious in holding distributors responsible for mis-selling, MAS should ask for specimens of advertsising materials/other documentation used by distributors when they were flogging these products, in addition to the input from investors about what they were told verbally by the relationship managers acting for the distributors. If any risk analysis completed for an investor shows the investor was NOT a high-risk taker, would MAS compel the distributor concerned to compensate the investor?

Anonymous said...

to e-lodge to CAD :
http://www.spf.gov.sg/epc/ePCLinks.html#

CAD FAQ
http://www.cad.gov.sg/topNav/pub/Complainant+Advisory+Booklet.htm

Anonymous said...

Many RMs are general degree holders (Arts, business admin, engineering etc) who r supposed to hv undergone training but actually hv no clue abt what they r selling - so they expect us to know too? Banks seem to blame us know after they hv sold and made commissions. True most of us dont know, so seller n buyer shd take some if not equal blame for the losses - like what Mr Tan KL suggested, we shd get 50 to 80% back.

Thanks very much Mr Tan for all your valuable help!

zhummmeng said...

The MAS chairman wrote for the deputy chairman and that is why they are singing the same tune and it is rubbish tune. They are trying to justify what the RMs did.They are trying to give an escape hole for these people and the FIs to escape paying everybody in full. Let me ask them. Tell us honestly whether do you understand these products in order to make an informed decision?? The chairman maybe a Harvard stuff but as long he didn't study financial engineering he cannot and not qualified make this statement.It is unfair to apply Caveat Emptor for financial products.

Anonymous said...

Dear Mr Tan,
Some of us bought from Maybank have a copy of Disclosure given during purchase that stated the Advisory Service under FAA(Chapt110)which the named RM is authorised or NOT authorised to advise. Ours stated the named RM as NOT authorised to advise on "Structured deposits".

The more I read the "Financial Advisors Act (Chapter 110)- Structured Deposits (S775/2005), the more I'm convinced that Maybank RM might have themselves confused and mis-sold the Minibond as "Notes/Bonds)" which was categorised together with General Insurance/Health Insurance.

During the interview when I asked for interpretation, Maybank claimed Minibond is not "Structured deposits".They said Minibond is categorised under "Securities(Notes/Bond/Debentures)" which is not regulated under FAA Chapter 110.
Is this correct ?

We will need financial expert to help us clarify Maybank's arguments else Maybank will find way to take it the way they want.

BH

Tan Kin Lian said...

Hi 3:31 PM

I do not know what is the implication of Maybank's statement. Maybe your group can seek legal advice.

Anonymous said...

1. Freeze asset of Banks sold bonds.
2. File a sue aganist US L. Bros CEO for frault and exporting Toxic fiancial products.

ACT now and act quickly

jane said...

Mr Tan, a big thank you. This 'battle' will be long, hope the team has the stamania to carry on. What MAS and FIs should do is to write to all investors, some has invested in structured deposits with a percentage of Lehman (they really do not know how badly they will be affected), and inform the investors of the status - full refund or partial. I can imagine if the FIs only refund to the 1000 who complain and the balance 9000 were ignored as they are unaware, is this fair. MAS should put immediate stop to 'perks' given by insurers to RMs or agents to push their sales. Incentives like trips, vouchers etc. This is encouraging hard selling. As our PM says today, we should not over regulate the FIs. Let's look at what is going on now with the China 'milk saga'. Our AVA has to do fire-fighting, even discoved products from Malaysia. Maybe this is Singapore Govt Management style, Always do FIRE FIGHTING, like the minibonds saga. We are always not pro-active, always wait for things to happen than act. Very sad.

Anonymous said...

Mr Heng,

Someone here said you went to Harvard, so your English must be very good.
How about this? Headline stating "Sound Investment" big bold words and below it, "Invest in the 6 giants,...." in Jubilee 3. What is your understanding of "Sound Investment"? High Risk or Low Risk? Be truthful with your answer. Will you believe you will lose ALL your money when just 1 company among so many go burst (assuming you were not told when you buy, just like all of us)? Is this misleading or deceptive? Is this a mis-representation? I keep the brochure for you to see for yourself.
I don't think you understand what is our complaint in the first place? And why so many people have so strong reaction, is it because we have nothing better to do? Is there justice for those who had been misled?

Anonymous said...

The real culprit is not so much of the RM/Personal Banker's selling tactics. In my humble opinion, we should ask what role did the senior management in the various FI has in approving the mini bonds. The RM/Personal Bankers are just the small fish sent out by their management to sell mini bonds. Just think about it, why would all RM/Personal Bankers tell investors that mini bonds are just like fixed deposits unless they were told so. Whoever came up with the idea to market mini bonds as fixed deposits is the real culprit and properly too high up in management to get the sack.

Anonymous said...

6.25PM,
your argument is like the drug kingpin sending out their runners or couriers to sell the drugs to the consumers. The couriers and runners(RMs or insurance agents or consultants) should know what they were doing and the danger. But because money or commission was good they were willing to be used by the drug lord(FIs)
The RMs or consultants are supposed to be qualified , an expert in the products they cannot deny that they didn't know the toxicity of the products. They had 2 options , to go along with it or to reject it and which I know of many RMs or consultants who quit and refused to be a party to this dirty scheme. The CEOs and the senior management must be responsible too and to be hauled up for blame. The FAA fine for misconduct for RMs or insurance agents is $25000 fine or jail and for the FIs is $250000 for each case of malpractice.MAS should impeach and prosecute them.

Anonymous said...

Don't blame Mr.Heng,the MD, for saying those things. He took the instruction from above. He was a mouthpiece only. So what, Harvard educated when you cannot think independently but has to rely on some body else. If you notice they all sing the same tune. They can form a choir for this Christmas.
Members of the choir include the chairman, the deputy, the MD, the finance minister, mm and pm the maestro.

ph he said...

In my view, DBS, Maybank and Hong Leong Finance are willing to meet and discuss with the failed investors because they have been given a lot of public/media 'exposure'. However, there is hardly any statement/press briefing from UOB, OCBC etc because there is not enough pressure put on them!

arizona auto insurance said...

We're running into some of the same challenges in the United States. If someone loses money on their mutual fund investment they are now seeking retribution in court for their losses. That's why it is doubly important for a sales person to log and track and keep great records to protect themselves.

Anonymous said...

Dear Mr. Tan,

I would like to thank you on behalf of all the victims for your great helps,guiduances and times given to us during this difficult period of time.

No enough words can express my gratitudes towards your selfless helps...again thank you from the bottom of my heart.

From:sbw

Anonymous said...

Blogger ph he said...

In my view, DBS, Maybank and Hong Leong Finance are willing to meet and discuss with the failed investors because they have been given a lot of public/media 'exposure'. However, there is hardly any statement/press briefing from UOB, OCBC etc because there is not enough pressure put on them!

9:23 PM

it just simply bore down to great PR thats all

EVEN if theres no PR, the PR message is STILL there, latently: sometimes an institution avoid getting into PR knowingly, in a deliberate attempt to precisely send a PR message, abeit a negative one - We dont want to alert you in any way that we really dont give a D*** what YOU think so what can you do

Anonymous said...

I am deeply disturbed when I read The Straits Times last week. The Relationship managers and personal banker now claimed that they were victims too. Does it imply that these relationship managers are not capable of making critical analysis of the structured products they are required to sell to retail investors or were they misled by the banks too? All I could say is stay away from these relationship managers and personal bankers from the banks. They are now trying to run away from responsibilities by claiming that they did not know what they were selling. If they could not understand the products, how could they sell it?
Last year my friend told me he decided to resign from a local bank as he felt unhappy. He felt that he should only sell suitable products to investors and not because he has to meet sales target every month due to the bank flavour of the month. However, every month he needs to meet sales target even though some of the products were clearly unsuitable to the retail investors.

Anonymous said...

When you complain to FI, the Retail Bkg head in S'pore may not feel pressure to settle cos it is merely his downline (RMs, investment counsellors, legal dept) who face the heat. He may also seek refuge from legal experts. He may take his time.

But this retail bkg head is appointed by head office in London/ NY/ Amsterdam. The directors/ snr mgt in London/ NY Amsterdam are the ones who appointed this guy and send him to S'pore on expat terms.

When you bring your story to international media/ international internet channels, it makes for sensational reading/ headline/ juicy dinner table / cocktail party gossips. Imagine the news headline "Pinstriped, Suited Western Bankers Cheating Poor Illiterate Grannies/ Widows/ Mental Retards in Developing Asia". International Media/ Internet chatrooms would buzz aloud with such juicy news stories.

How can the directors/ snr mgt in London/ NY/ Amsterdam ever face their friends/ peers at their high society cocktail parties. Don't forget that these directors in banks also hold high positions in other fields (eg CEOs of oil companies/ manufacturing MNCs/ retired govt officials). They expect their bank directorship is easy job, just to earn extra pocket money and some extra prestige in their CV, not invite such negative publicity on themselves.

Once they are exposed in their home countries, then the pressure will come from top-down: from directors to group ceo to ceo in s'pore to retail bkg head in s'pore to s'pore downline.

Anonymous said...

I am an investor of DBS High Notes. I have already wrote a formal complain letter about the mis-selling. However, I do not know where to send this letter to. Must be it a hardcopy letter or an email will suffice? What is the address? Awaiting for your enlightenment. Many thanks!!

Anonymous said...

I hope the MAS MD will read the newspaper properly. Even the RM and personal banker admitted that they did not understand the products they were selling. So how could you say buyer must take some responsibilities? U mean being responsible for being cheated? Please have a heart, even though you are from Harvard, it just show that you are not a critical thinker. Anyway I hope Singapore have more talents like Mr.Tony Tan. I hope the government can take a more proactive approach in solving this crisis. DBS, althought there are only 10000 investors, bear in mind that Millions of Singaporeans are observing your moves. If we Singaporeans are not happy and does not trust you anymore, millions of Singaporeans can just withdraw our money. Anyway I am not an investor, but I like to see justice done, especially in a first world country like Singapore. Don't disgrace us Singaporeans.

Anonymous said...

I was joining a group trying ways to get back their money invested in the Lehman Minibond at the laywer office over the weekend.
The Press was there and it was reported in the Strait Times yesterday.

The reporter interviewed a couple after our meeting with the laywer but some of the important points were not reported in the newspaper.

The couple does not belong to the vunerable group at all. They are in their 40s . They are educated. The husband was retrenched and the wife work as an Officer in an organisation. They lost a total S$230k which they said are for their two teenage sons education. They live in HDB flat and do not drive. They look so stressful and were quite determined to obtain their money back as they feel that the product was mis-sold to them. From what I had gathered , that amount may be a substantial part if not all of their saving for their children education.

My point here is that not only the vunerable group suffered from this event. Mis-selling is the key point which lead to many victims who suffered from msitake of the FIs.

Anonymous said...

Dear Mr. Tan,

Thank you very much for your continuing good work to lead us.

I know you have been recommending people to go complain to the FI first; then, if not work out, go FEDRIC. MAS recommends the same also.

However, FEDRIC is limited to a compensation of $50,000. The average investor in MiniBond, e.g., invested about $40,000+ after excluding about 1/4 for institutional investors. Following the concept of a bell shape curve, this could easily imply that there are say 3,000 or so of investors who invested more than $50,000 and some substantially more than $50,000.

I joined the group which talked to lawyers about class action because of this reason.

Question: what do you recommend for people whose loss is higher than the FEDRIC limit?

I know one potential solution is to have the FI agree to raise the limit which they are bound by the FEDRIC decision but is this realistic? I have not heard any FI coming saying they would agree so. In fact, I was surprised to find out that when one goes to see the FI, they are not allowed to bring a lawyer with them although a bank can bring their lawyer.

Just trying to point out why some of us are considering class legal actions.

I hope MAS folks will read this blog and address this concern in the next communcation with the public also.

Anonymous said...

Dear Mr Tan,
I have filed dispute to relevant FI, followed by interview which they sent a couple of representatives from this FI to my house. So, it was a three to one (investor) type of interview recorded on taperecoreder by FI themselves. Throughout course of 'interview', felt like these FI reps were trying to 'catch' my words, and the interview questions were veered towards the interest of the FI rep who sold me the product. At the end of my interview, I am just left wondering if their investigation result would be biased towards their own staff? All I can do now is to wait for a reply on outcome of that interview. Is this type of interview fair to us.

Anonymous said...

Dear Mr Tan,

Upon filing dispute to relevant FI, it sent three reps all from this company to 'interview' me on recorded mode. It was a three to one (investor - me) interview. I wasn't expecting more than one interviewer actually, and they didn't even inform me that there were going to be more than one interviewer. If it was so, I would have gotten another person present with me during the interview. During the interview process, I felt that questions thrown at me were veered towardst the interest of their FI rep who sold me the product. They were also trying to 'catch' my words during the interview. After the interview, I am left wondering if such interview procedures are fair for me?

Anonymous said...

http://www.forbes.com/2008/10/22/Intelligent-investing-wallst-robbery-lehman-UBS-panel.html

Anonymous said...

Dear Mr Tan,
I think the concern of 10.22AM is right.

1. For investors who invested less than $50k, you can approach Fidrec,but you can't bring a lawyer whereas the FI can.The first stage is Mediation and the result is not binding to the investors,so if you are not satisfied with the result,you can:(a)ask Fidrec to refer your dispute to Adjudication where the FI must agree to submit to Adjudication.The result is binding to the investors , it means you cannot take anymore legal action against the FI and any other action in any other forums.
(b)seek for outside lawyer to take legal action against the FI.
2. For those invested more than $50k, Fidrec is only agreed to hear your case through Adjudication where the FI must agree to submit to Adjudication, but the claim amount is still up to $50k.

Hope the above clarified some of our doubts.

Anonymous said...

10.02 & all

With refer to your comment, i would like to share more detail in their conversation to the Reporter. I heard the couple do ask the reporter to report all the statement they made and want all the true to be published and let know to all who have encountered the same fall. It seem a lot of details did not stated out, eg.
1)The prospectus was not open up and go through with the customer during their process of the investment/deposit.
2)The RM didn't highlight / remind of risk but only ensure of the secure, stable & benefit of the products.
3)Despite multiple time of transaction over the same product, RM still did not 'hint' or show some level of risk that the same customer of them may be involve.(This show that RM themselves may not know the product risk as well, in another word, FI may not provide sufficient training & products knowledge to their RM too).

A lot of the truth was not be able to publish in the media. Sad...even true thing still must be hide from public...

Mrs Lim

Anonymous said...

Interview is both ways. We should prepare a list a questions to ask the interviewers such as:
1.How the product was structured or designed? Can they explain?
2.Why every investor was told that
the product is safe and low risk?
3. Why the bank never do the part to protect investors' interest.
4. Show them the evidence of mis-selling and ask them to explain.
Some investors show them the proof and the related FI did not given any reply even after 4 weeks.
It is a clear cut mis-selling. Do not afraid, just demand for justice.

Anonymous said...

Is it explorable to form a group for investors above S$50K? Unity is always good!

ph he said...

Can Fidrec make an outright exception to also accept claims of above S$50K since there are hundreds of million of dollars involved as well, although the number of people involved may be 'small'?

Anonymous said...

Anonymous said...

Interview is both ways. We should prepare a list a questions to ask the interviewers such as:
1.How the product was structured or designed? Can they explain?
2.Why every investor was told that
the product is safe and low risk?
3. Why the bank never do the part to protect investors' interest.
4. Show them the evidence of mis-selling and ask them to explain.
Some investors show them the proof and the related FI did not given any reply even after 4 weeks.
It is a clear cut mis-selling. Do not afraid, just demand for justice.

12:42 PM

THEN THERE WOULD BE NO INTERVIEW REST ASSURED, OR VERY VERY BRIEF ONES.

Anonymous said...

Is it explorable to form a group for investors above S$50K? Unity is always good!

5:55 PM

Blogger ph he said...

Can Fidrec make an outright exception to also accept claims of above S$50K since there are hundreds of million of dollars involved as well, although the number of people involved may be 'small'?

6:13 PM

NO, FIRSTLY FIDREC HAS TO OBLIGE BY RULES AND REGULATIONS. THATS THE BASIS OF THEIR EXISTENCE.

SECONDLY I REALLY DONT SEE ANY HUGE INCENTIVE FOR THEM TO BREAK THEIR GUIDING POLICIES BLATANTLY, FOR HOWEVER ANY CAUSE, GOOD OR BAD. BUT OBVIOUSLY EVERYONE MISSING THE BAD PART.

Raymond T said...

Kudos to Mr Tan Kin Lian. It is said heroes die young. So in this case, maybe we should christen Mr Tan as Superhero instead :)

Anonymous said...

If MAS is not going to help all the victims decidedly, then i feel that the FIs will just drag on for years, like that of the CLOB issues! However, Singaporeans should be entitled to a better treatment this time - MAS should exercise the rule of law, fully!

Anonymous said...

Is it a good idea to pay very high salary? When most staff are paid highly, they would concentrate on high profile jobs to justify the pay.
Few people would want to do mandune tasks like audit and vertification to ensure "bad products" or "bad practices" are stop early? and rely on easy path like "buyer beware".

Anonymous said...

In order to cut a very long story very short, i still feel very strongly that RISK and HIGH RISK and LOW RISK are subjective words and emotionally charged and should be AVOIDED. What is low risk 2 years ago (before subprime crisis) can become high risk today, you can never argue with a bank if you keep on using these words of RISK.

I feel strongly that a very simple yardstick to judge whether misselling took place:

Was the investor informed that if one entity collapse, he could lose the capital entirely? THIS IS ALL THAT IS NEEDED! If the investor was aware, then - No refunds. (Risk assessment of any instituion is not the bank's nor government's responsibility!!!)

If the investor had been informed that if one entity collapse, he could lose the capital entirely, then 100% of the principal should be refunded, because he was not aware at the point of sale.

It is useless to go into details and analyse the prospectus and training materials, because the bank's lawyers can read between lines and argue to their advantage. But it is the responsiblity of RM to highlight the crucial fact as indicated above.

Hope this helps!

REX

Anonymous said...

limtuakang 4:55 am
To: ALL (1 of 3)

10785.1

Some senior officials distrust Tan Kin Lian and have expressed their displeasure privately at his “antics” which has not been helping their work. During a high level meeting last week, one official was said (unconfirmed) to have uttered the expletive ”What the hell is Tan Kin Lian doing ?” to his colleague.

Mr Heng Swee Keat let loose a freudian slip in Sunday Times alluding to Mr Tan Kin Lian subtlely when he said this:

‘I understand that affected investors are anxious and looking for solutions. Unfortunately, I think some of the advice they are receiving is not helpful because it has generated anxiety and confusion.’

The authorities now find themselves stuck in a quagmire. They cannot reprimand Mr Tan Kin Lian openly without incurring the wrath of ordinary Singaporeans many of whom now rever him as the “Champion of the underdogs”, yet it is becoming a torture to allow him to continue stealing the show which rightfully belong to them.

Read full article here




Options Reply





From: interpretsg 12:20 pm
To: limtuakang (2 of 3)

10785.2 in reply to 10785.1

from what i see tan k l has more moral authority over Singaporeans than most of our ministers do.

Options Reply

Anonymous said...

Six Brokerage to compensate vulnerable investors.., just wonder how many will be eligible for the compensation, old and low educated people will not know how to get these products from the brokerage hse... this is as good as "empty promise"..just say say for the govt and public to hear..Haha.

Anonymous said...

CIMB said only 2% is vulnerable investors, probably only 1 or 2 investors.

Anonymous said...

To Anonymous 10:02am

If the authorities had done what was right from the beginning and helped the investors, TKL would not have to go thru so much trouble to help the investors.

Why were our authorities so quiet from the start despite so many pleas from the investors ? Are they hoping they can sweep everything under the carpet and closed the case and evade probing questions ? Why are we tax payers paying them world class salaries for this kind of low class public service ??

They don't have a heart for the commom man, especially those citizens who have helped to build Singapore to what she is today. TKL has a heart. Period.

Anonymous said...

Over 62 and Primary 6 people normally do not use brokerage. May be 1 or 2 exception. Just PR exercise.

Anonymous said...

MAS was torn between the FIs and the investors and it took them time some before the Harvard MD , GCT, LHK decided to take the middle road. It was supposed to be measured and to err on the side of favouritism.

Anonymous said...

Rex

I like the way you cut long to short.

To solve problem, MAS can ask all RMs who sold the products to do a statutory declaration to comfim if they had informed the respective customers that "if one entity collapse, he could lose the capital entirely."

If they do a false declaration,they go to jail. Just see how many of them dare to do it to clear the FIs for full compebsation.

From customer's poit of view, if the RM did tell us the truth, do u think there is anyone would mad enough to give them the cheque.

FIs have to just get ready to compensate every one 100% to cut long to short.

Do not know the Harvard's scholars from MAS has thought of it? It wil help the nation to be more productive. haha

Mad Dog

Anonymous said...

I agree the FI have to compensate everyone misold 100% to regain any trust in the system. The longer this drag on the more people are supporting the victims as they start to understand the real happening. Several of my colleagues and friends who had not paid much attention earlier, thinking it is just a group of uncles who bought a risky product that they shouln't have, they now understand the FI were like cheating and have lost trust in these financial institutions. they cannot understand why MAS is siding the FI to let them get away with these "vulnerable" crap

Anonymous said...

See wHKMA refers 40 Lehman-Brothers-related cases to the SFC for further action
The Hong Kong Monetary Authority (HKMA) has today (October 24) referred to the Securities and Futures Commission (SFC) 40 cases involving complaints of alleged misconduct in respect of investment products related to Lehman Brothers for it to decide whether to take further action. The 40 cases, which are the second batch of Lehman-Brothers-related cases referred in this way, involve alleged misconduct by two licensed banks in Hong Kong, one of which was subject to referral in the first batch of cases referred to below.





(Media-Newswire.com) - The Hong Kong Monetary Authority ( HKMA ) has today ( October 24 ) referred to the Securities and Futures Commission ( SFC ) 40 cases involving complaints of alleged misconduct in respect of investment products related to Lehman Brothers for it to decide whether to take further action. The 40 cases, which are the second batch of Lehman-Brothers-related cases referred in this way, involve alleged misconduct by two licensed banks in Hong Kong, one of which was subject to referral in the first batch of cases referred to below.

On 17 October 2008, the HKMA referred the first batch of 24 Lehman-Brothers-related cases to the SFC for further action. These cases had been reviewed by the HKMA, which had determined that there were sufficient grounds for referring them to the SFC.

“In light of the large number of complaint cases, the HKMA, from now on, will streamline the investigation process by identifying groups of cases with common features which appear to justify referral to the SFC in batches for it to decide whether to take further action. The HKMA will cooperate with the SFC in carrying out further investigations in order to expedite the process,”the HKMA spokesperson said.

“This arrangement is consistent with the principles established under the Securities and Futures Ordinance and the Memorandum of Understanding between the HKMA and the SFC. Sanctions that the SFC may impose on a bank include suspension or revocation of registration, reprimands, fines or prohibition orders,”the HKMA spokesperson added.

“The HKMA will continue to work on the large number of complaints that still need to be assessed as quickly as possible, and in a fair and objective manner,”the spokesperson said.

The HKMA had, up to 23 October 2008, received 16,301 complaints concerning Lehman-Brothers-related products. Apart from the 64 cases referred to the SFC so far, the HKMA had formally opened investigations on 285 complaints and was currently seeking further information on 1,942 complaints. 28 complaints had been found to lack sufficient prima facie evidence to support further action ( A table summarising the complaints received so far is attached ).

For further enquiries, please contact:
Peggy Lo, Manager ( Press ), at 2878 1687 or
Hing-fung Wong, Manager ( Press ), at 2878 1802

hat MAS counterpart in HK has done...

Anonymous said...

Tim.

Why differential the age group of min.62 yrs. Why not "O" levels and lower. Surely the prospectus must be even harder to understand.
If I got 3 "O" levels Kopi O, Teh O and MilO........they know my limited knowledge on compassionate grounds!

Anonymous said...

Mad Dog,

MAS will no do it. Because they are part of the game. Wake-up!

VS said...

In the case of Minibond 3, failure of the Note Arranger (ie Lehman) has terminated the note. I doubt many RMs have highlighted this pt. Also most RMs would not have highlighted that some failures in the underlying securities would also affect the product.

Bottom line - the RM under-informed the investor of ALL the risks.

-VSL

ph he said...

MAS should have a simple definition for 'mis-selling' regardless of age, education or whatsoever. If the RM / sale representative did not explicitly mention and highlight the following clause at POS or during signing of sale agreement:

"if one entity collapse, he could lose the capital entirely."

Then there should be a 100% compensation!

Anonymous said...

Mr.Tan Kin Lian's advice did not cause distress and anxiety. Instead it provided comfort to the elderly as they now are more confident of getting refund. I have learnt a great deal of financial knowledge from Mr.Tan K.L. Although I am not an investor, I am happy that there are people who do The Right Thing immediately. Hmm, I doubt DBS will response if not for this blog. Btw, the Relationship managers have admitted that they did not understand what they were selling so most probably lawyers could use their statements that mis-selling has occured island-wide? Frankly speaking, I am pissed off by this irritating RM who always ask me to buy this investment products. But I don't because I don't trust them because my friends warned me about these ban(k)dits.

Anonymous said...

Can anyone please help me. My mum went to a POSB bank to update her saving account book. However the teller changed the saving account book to a statement based even though my mum did not want. However she could do nothing as her saving account has already been changed to statement type. Is this illegal? Why did the local bank do this despite my mum's protest. I am very concerned about banks' antics to the public, particularly those middle-aged who do not understand English. Now, I told my mum not to go to the bank alone. SL

Grateful Singaporean said...

MAS has been too slow to response. To many investors, a day is akin to a year. People are worried about their hard-earned money.I doubt people up there know since they make so much money and does not know what it meant for these investors. Thank god, there is Mr.Tan who provided the leadership to assure these people. Thank you Mr.Tan Kin Lian, your have done a great job. This is what integrity is about and Doing the Right thing fast and efficiently. This is what we have learnt from Civics and Moral Education. Thank you Mr. Tan.

Anonymous said...

DEAR INVESTORS OF STRUCTURED NOTES,

I UNDERSTAND THAT YOU NEED TO HAVE A CDP ACCOUNT BEFORE YOU CAN BUY MINI-BONDS OR HIGH NOTE PRODUCTS?

IF IT'S TRUE, THEN THIS IS DEFINITELY CALLED "INVESTING" AND YOU GUYS ARE CERTAINLY NOT BLUR!!
YOU FELLAS DON'T DESERVE ANY COMPENSATION AT ALL!!

Anonymous said...

Dear Mad Dog
Thank you for your comment.
You also have a good idea. Make RMs do declaration. If they did not do declaration, it means the customer was not informed that if one entity bust capital all could be lost.
The whole point is to avoid using the emotional and subjective words of RISK and high RISK. If RM is hesitant to make declaration that they did inform customer that if one entity fail all capital lost, it will be deemed that the investor was cheated and can therefore claim 100%.
If RM said that he DID inform the investor then let the investor fight it out with him, call him liar or whatever. Perhaps there are some honest RMs who might actually say, yup, i forgot to tell the customer that one entity go bust the capital is gone.

If the court cannot decide who is lying, a 50% settlement is reasonable. It is better that 100% of all (vulnerable and non vulnerable) get 50% compensated then say 30% get 100% with the rest Zero.
Any supporters...?
REX

VS said...

6:43 PM,

You have nothing to worry about. POSB is phasing out the old "passbook" concept and replacing it with the new "statement savings a/c". Less maintenance for POSB. Easier for the customer also - just go to bank with your NRIC, no need to carry passbook. POSB will send monthly statements to your mother.

I think all other banks have gone the "statement savings a/c" method. POSB is the last man home.

-VSL

Anonymous said...

No one is torn between anything, they are just sitting and not paying thats all.

Everything is very very clear from the formal announcement which say

1. value is 0.00 on redemption

2. value is still 0.00 after redemption

they bothered to add the .00 TWICE means they meant it

get over it and move on, they already announce their intention they are disregarding the issue IF its ever an issue to THEM

Daniel said...

I am trying to relate financial products' certification in the line of food (AVA), infocommunication (iDA) or electrical products' (Safety Authority) certifications etc.

MAS can consider setting up specified safety guidelines for the marketing of financial products.

How about setting up a financial product review department within MAS? The major role is to review and screen through the marketing materials, prospectus, etc. of newly-launched structured products based on specified guidelines (set by MAS) and highlighting any misleading, ambiguity, over-use of financial jargons, hidden or undisclosed risks in the marketed information to the FIs for review and improvement.

Of course the review department will have to work with the FIs to understand the product to be registered and this certification process will cause some delay to the product launch which the FIs have to factor into their marketing campaign.

When the FIs have done their due diligence on the marketing materials, then the product can be certified and approved by MAS and allowed to be marketed to the public retail investors?

This team will add value to ensure the safety and suitability of financial products for public retail investors as compared to merely registering them.

This may not be a fail-safe system but it can help to reduce mis-selling, misinformation or misrepresentation by RM/FAs to the educated public.

At the end of the day, having a regulated system for financial product is better than none.

(I've not worked in the financial services industry)

Anonymous said...

EVERYONE in the chain (not just investors) to declare whether they know risks, whether they disclosed risks?

Did FA disclose risk? did FA know risk?
If not, did FI's Product Specialists disclose risk? did they know risk?
If not, did Issuer disclose risk? If not, the Issuer should be taken to task!!

Anonymous said...

Daniel,

MD of MAS once said in meeting that losing to Hong Kong is not an option! That's why these products were launched one followed by another.

Come to think of it, why Lehman did not launch minibonds in Japan when Japan's interest rate is 0%? If Lehman did not launch the product it is likely they think the authority there will not approve or Japan did not approve this product.

Why in Asia only Hong Kong and Singapore have minibonds? Likely because both want to be Asia Financial Centre and both are competiting with each other. Lehman likely to see this "loophole" and approach both authorities and exert presure to launch these toxin products to retail investors.

Anonymous said...

FIs are using different questionnaires for interviews. XXXX asked for Occupation, Employer Name and Salary. Other FIs did not ask for such information.
If this is NOT an MAS requirement, then XXXX should not ask for such data, and investors NEED NOT provide such data.
Mis-selling is Mis-selling - it must NOT be determined by Salary.
XXXX is very KS, KS, KS.
IT'S HIGH TIME THAT MAS PUT A STRONG FEET INTO THE COMPLAINT HANDLING PROCESS!!!

Anonymous said...

The 3 INDEPENDENT PARTIES appointed by MAS MUST LIVE UP TO THEIR RESPONSIBILITY, and NOT BAT A CLOSED EYELID into the way some FIs are RAMPANTLY handling the COMPLAINT HANDLING PROCESS.
With so many COMPLAINTS about the way some FIs are handling the process, why are the 3 independent parties not putting a STOP to the mal-practices highlighted. These are NOT ISOLATED cases, but many investors are saying the same thing.

Anonymous said...

That will be over regulating and MAS doesn't like that. They believe like Alan Greenspan, no regulation and let the FIs do anything they like.
I wonder the Harvard train knows any head or tail about structured products.
For all you know he also thought they were bonds.

Anonymous said...

DBS declared the value of their constellation product.

http://www.dbs.com/dbsgroup/announcements/HN5_SGD_Issuer_Settlement_Notice.pdf

june said...

Today ST Forum - MAS Reply to Stanley Jeremiah letter in the Forum. Based on the reply which is standard, it seems MAS is currently at lost. What to do with the FIs? You cannot fined them 'peanuts' or banned them. Let's wait and see and let the world know how 'good' is our regulatory system. Currently, a lot of other Structured Deposits investors not affected by mini-bonds still thinks their investments are safe? MAS still has not addressed these issues which are time bomb. It's coming to monthend, Banks supposed to give answers, lets see what DBS has to say today

VS said...

7:12 PM,

You just don't get it, do you? The issue is NOT about investing. The issue is about NOT being made aware of ALL the risks that can jeopardise the product.

This applies not only to investing but to buying milk powder. If you understand the difference, come back to this forum and provide constructive comments.

VSL

SL said...

Mr.Tan, how about opening this petition to all Singaporeans and not to the investors alone? I feel that MAS should do more to prevent such toxic investment products particularly from Amercians from selling to the retail investors again. I am disappointed with PM Lee's views. I believe more regulation is required. Now I feel Malaysia is doing better in financial regulation than our country. If we are allowing suspicious investment products into Singapore, then we will lose our competitive edge as a financial centre because people will not trust the government as now they feel that these investment products are toxic.

Anonymous said...

I remember sometime around July when a RM introduced a structure pdt to me. It gives around 8% pa every 3 mths. This payment will be if any of around 5 indices ( Spore, Hongkong, Taiwan, China & I think one more). When any of the indices dropped 50%, then the investor would get back 50% only and no more payment.

I think on Tue, Spore (around 3,000 then) & HongKong indices already dropped 50%.

It's very clear that in June/July this year, asian markets already expected to drop sharply.

Better stay away from structured products.

Anonymous said...

I agreed with 12.55pm so that others can sign since 9000 other investors do not know how to use the web.

Anonymous said...

I do believe that the investors of High note 5 have a strong case against DBS if they wish to recoup all their money. Within this year alone, DBS sent out a few letters to the investors to "reassure" them. However in one of the letters, the explaination regarding how the principle amount invested in High note 5 will be affected is deeply flawed. This is proof that DBS is quite clueless about how the product actually works. I urge all investors to seek legal redress as I believe DBS is standing on shaky grounds as a result of the release of the above letter to the investors. The letter is sent sometime around March 2008 by a Vice President of DBS named Brandon Lam.

Anonymous said...

May be it is a good idea to hv another peition to request for tighter control over CLS.
It can be signed by all concerned sporean, not just the victims.

Anonymous said...

We shall include in the partition #4 or start a partition #5 to request to the Three Reputable Wisemen, independent parties (appointed by FI? Independent?) to publish their independent report on the whole issue and recomendation.

We sincerely like to hear their frank opinion!Their view cannot only for the comsumption of the FIs and MAS. It is called transparency!

Tan Kin Lian said...

Hi
Several people have requested for a new Petition #5 for anyone to sign (and not just invsetors).

Can someone draft a Petition and send to kinlian@gmail.com. Thanks.

Xiang said...

Although MAS is supposed to be the regulator but I think they also do not want to be very strict with the banks and financial instutions otherwise this cannot do, that also can do, how to do business. Generally, people do not like to be scrutinized. MAS is not stupid, they probably is aware of what's happening long time ago. It is just that nobody has expected this Lehman, Jubilee, etc.. has failed and so many people, young and old are affected. So in the first place if nobody complains, who cares. Now that this has come out in the light, what can MAS says, admit oversight on their part or that they are being lenient?

Anonymous said...

It's HIGH time to take a TOP-DOWN approach. MAS and the 3 Reputable Wisemen (quote 8:31pm) - if they haven't already done so - to AUDIT the FIs and their Product Specialists. ONUS is on FIs and Product Specialists to show DOCUMENTATION / PROOF that they have complied with all the ACTS / REGULATIONS / process / disclosure etc. Engage 3rd party AUDITORS eg KPMG etc. to do the AUDIT. Then PUBLISH their FINDINGS quickly.

BOTTOM-UP interviews with tens of thousands of investors take up too much of our Nation's RESOURCES. Cause too much STRESS to investors and their family members too. Many are staying up LATE to catch up with BLOG UPDATES. Many are meeting to discuss/sign letters/collective actions, meet lawyers etc. Many are distracted at WORK. Many have NOT ENOUGH SLEEP, are NOT PRODUCTIVE at work etc etc. This BOTTOM-UP complaint process, case-by-case interviews, have not be EFFECTIVE. Like "Robbed going to Robbers".

Surely our Government, MAS, Scholar Advisors etc can see all these going on. The world is entering into a Recession, and Singapore's MANPOWER - our valuable RESOURCE - should be focusing on Creating Values for the Nation. And NOT on going through SALES DOCUMENTS, searching for EVIDENCE of mis-selling.

What an utter waste of manpower. MOM if there's any way to measure productivity, I'm sure many are affected, many are not productive at work. Family life suffers, people (like myself) are on the web and emails, neglecting our children etc.

FIs have earned our trust and our monies over the decades, since our forefather nation-building days. Is it too much to ask the FIs to come forward to DO THE RIGHT THING. In turn, we will pledge the compensated amounts as Fixed Deposits with the FIs, for 3-5 years. There is no OUT-FLOW of cash for the FIs. Together we Build our Nation.

I hope in our next National Day, I can stand up proud to sing our Patriotic national songs, shoulder to shoulder with our bankers, brokers, FAs etc. I hope the Nation TRUST and UNITY will be restored.

Anonymous said...

May be can start another petition to request the appointment of independent person as mediator btw FIs and victims for a fair compensation. Mr Tan would be a good choice.
Friends & family members of the victims shd also be allowed to sign.

Anonymous said...

10.00 PM

Excellent summary of situation.

Productivity Loss = 10,000 customers x 3 family members x 5 relatives x 5 work colleagues x 5 friends = Local Population = Reputational Risk.

Observer

Anonymous said...

Structured products affected by Lehman brothers = 10,000 victims.
All Structured products that may be at risks = 80,000 -100,000 investors?

Anonymous said...

I see a lot of fuming still that FIs should compensate fully everybody, that this will reduce suffering and build national unity, a caring nation, etc.

I think this stems from the extremist view that FI's are 100% liable. I take the view that FI's are also human, they make mistakes due to the clever crooks in wall street cheating even professors and learned people as well as man in the street.

Remember, FI's in Singapore give jobs to singaporeans. Remember if FIs compensate 100% of the people 100% their investment, the FIs P&L will be in big trouble. Many of them will go bankrupt and retrench very very much more number of singaporeans. Ok the investors get back 100%, but there will be 10000 people out of job and FI closures will also bring another set of economic problems. Lets face it this is global problem caused by world wide cheats. We cannot make the FIs bear 100% of the cost to 100% of the people in the name of national unity, etc.!!!

I stick to the simple view that MAS should instruct all the FIs to target to compensate 50% of 100% of the people. Anyone wishing to go for more than 50% can go for a lawsuit on a private basis. If they lose they will forfeit even the rights of the 50% and they also pay legal fees. Then there is some objectivity and we avoid all the completely useless lengthy discussions best left to lawyers.

REX

Anonymous said...

Yes I agree with REX. The blanket compensation for "vunerable" group is the wrong way of doing it. By law of large number there will be some of te "vunerable" group who did not got misled and bought the lemon products with full information. Similarly there are also many others in the "non-vunerable" group who were misled.

Compensation should only be given to those who are truely victim. Otherwise, it is unfair to both victims and the institutions. Many victims would not receive compensation because they are not in certain category while the institutions will be incuring unnecessary losses which led to low P/L and ultimately lost of jobs.

Anonymous said...

In a letter dated 31 March 2008 sent by DBS regarding DBS High Notes, it was stated “.... it would take several underlying reference entities in the collateral to suffer Credit Events before investors suffer a loss to their principal amount."

In actual fact, it only requires one underlying reference entity to suffer a credit event to wipe out the whole principal amount, not several underlying reference entities. This is the case in the bankruptcy of Lehman Brothers which is a credit event to only one single reference entity.

Saying that it requires several reference entities to suffer credit events before any losses will be incurred gives investors the wrong impression that there is some kind of buffer and may have delayed them from selling the product and cutting their losses earlier.

Furthermore, since an official letter from DBS can get it so wrong with regards to the workings of the product, then it is reasonable to conclude that the Relationship Managers selling the product is no better at explaining the exact workings and risks of the product to customers when making the sales.

Thus, I do believe that the investors of all DBS High note series have a strong case against DBS if they wish to recoup all their money. I wish to stress that base my above analysis, every investors have a strong case regardless of your investment risk profile/appetite. The best course of action is for all the investors to negotiate with DBS or take other necessary actions collectively. I urge all investors of all DBS High Notes Series to seek legal redress if DBS is not willing to accept full responsibility as I believe DBS is standing on shaky grounds as a result of the release of the said letter to the investors.

I wish to give DBS the benefit of the doubt and believe that this is only proof that DBS as an institution is clueless about how the product actually works and that it is not out to defraud the customers with wilful misrepresentation.

Best Regards
Lim Kay Wee

Anonymous said...

got news

there will be no compensation the matter not on agenda

Anonymous said...

Whose agenda are you referring to? All investors of DBS High Notes Series can bring up their cases against DBS with or without an agenda.

Best regards
Lim Kay Wee

Anonymous said...

" only proof that DBS as an institution is clueless about how the product actually works and that it is not out to defraud the customers with wilful misrepresentation."

What nonsense ? Any difference from selling a tonix poison manned for rat eradication and instead sell it for human consumption because the storeman is clueless on what the product is about. It is even worse than misrepresentation ?

There is a big gap between clueless and representation.

Anonymous said...

I was merely trying to give DBS the benefit of the doubt. Anyone is free to decide which is the greater crime - being clueless or wilful misrepresentation.

My apologies if I offended any investors.

Best regards
Lim Kay Wee

Joseph said...

Todays Straits Times reported RMs being suspended by DBS? MAS should barred Banks from 'selling any form of investments or insurance' products with immediate effect pending completion of full investogations. I am not trying to destroy the RMs rice bowl, but the Banks need to pay a price for it. I remember 2 years ago my friend's mum (60 years old) was sold Pru ILP $15,000 as alternative to FD. No point suspend the RMs when the root of the problem is the RMs bosses. This is the problem with our Singapore Management. Any problem poor workers kenna and the bosses got away free. Is this democratic?

Anonymous said...

Blame the milk maids?

Well SOMEONE got to 'kick the bucket' in a soured milk farm

Conveniently so too

Anonymous said...

You're right. I wonder what kind of punishment can suspending RMs make? Probably structured products cannot sell anyway in this climate. RMs prob planning to leave job, change industry anyway. No loss to RMs cos they did not have to study very hard to become financial advisors anyway.

Anonymous said...

Sonny,

being aged 61 and with "O" level standard of education, I've been approached by many Financial Advisers, Relationship Mgr. and prominent Insurance Sales Agent too.
I was approached with following products:

1) ILP (Insurance Linked)
2) Unit Trusts
3) Bonds / Minibonds
4) Structured deposits.
5) Infracture Funds
6) Emerging Market Funds
7) Commodity Funds
8) Forex and etc.

The catch to beware, is the upfront fees and annual commission that varies from 0.5% onwards and the restrictions imposed about penalty charge should you withdraw or default etc.
Bottomline, is to suck you in as the term "No Free Lunch" is what I learned!
Last year,I was also given a free so called Financial Health Check by a top Insurance company and I obliged with all the free treats @ a coffee house prior to all the introductions and the tendency to divert my investment portfolios into probably buying or investing in their products!
Way back in 1996/97 Asian Financial crisis many so called Financial Advisers suddenly disappeared or switched jobs into landBanking Consultant /Oilpods Rep. and many in the MLM line too thus leaving me in a lurch.(lessons learned from there) and today I can truely count my blessings and say NO thanks to all the Financial Products for me and merely say that "once bitten twice shy"
Conclusion: Some Financial Products really need HEALTH CHECKs in this Global Financial Meltdown.
You Decide! as the Govt. cannot look after what you do as you are the master of your DESTINY!!!

Anonymous said...

It's the management that pushed the RMs to sell the high profit margin products that increased the FIs profits for their benefits. If cannot meet target, RM has to leave the FI.

When problems arise,they blame and suspend the RMs. So sad.

Sanity said...

RMs are the mouth pieces for the FI management. I am not at all surprised that some of them were even told by their management not to reveal the high risks involved or to show or discuss the pricing statement or prospectus with the potential investors 1st before persuading/coercing them into buying the toxic products.

If this is not outright misleading and misrepresenting, then what it is?

If these products are that great, I would like to know how many FI management and RMs and their families bought these products? Maybe the authority may want to check that.

Am sure the results will be a revelation and speak volume.

Anonymous said...

I pity the RMs. Some of them may have bought the product themselves. And they are now cought in between. They cannot even complain.

ph he said...

If the RMS also feel genuinely being 'cheated' and 'forced' by their banks to sell these structured products without proper training and understanding of the products, all the more they should stand up for Singapore - as witness against mis-selling!!!

Anonymous said...

Anyone who still think that these so-called products have a role anywhere (including any MAS officials, govt leaders and that NTU prof who wrote that hazy article in Sunday Times two weeks ago) should read some of these articles in reputable vendors:

Junk toxic structured products: http://www.bloomberg.com/apps/news?pid=email_en&refer=home&sid=a0jln3.CSS6c

The US equivalent of our town councils, MRT operators and so on being similarly deceived like our senior citizens:
http://www.nytimes.com/2008/11/02/business/02global.html?em

Very curious. Why doesn't our Straits Times reprint these articles, like many others that they do regularly?

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