29 July 2009
An elderly woman who claims to have lost nearly HK$260 million on high-risk financial products is taking a Swiss- based investment bank to court.
Chan Wai-yee, 77, says UBS advisers talked her into buying an equity accumulator package just months before last year's market crunch.
The High Court writ filed by Chan comes less than a week after 16 Hong Kong banks agreed to buy back Lehman Brothers minibonds at 60-70 percent of their original value.
She claims she did not understand the documents she signed because they were in English, and no one from UBS informed her of the risks and nature of the investments.
The writ states that Chan was a client of Hang Seng Bank for four decades, and she opened a Prestige account there in January 2003. She was advised on investments by managers Wong Mei- lun and Shirley Cheng.
Chan says her nest egg was accumulated through hard work, and she had limited experience in stock investments. As she did not understand English, she relied on advice from Wong and Cheng.
She was only interested in low-risk investments because she wanted to preserve her capital, Chan says.
So she never went into any risky investments while her money was with Hang Seng Bank.
Then, during the market boom in mid-2007, Wong and Cheng left Hang Seng Bank to work for UBS.
Chan claims that Wong then approached her and invited her to move her assets to UBS.
She signed various documents from time to time to open an account at UBS, but never indicated to Wong, Cheng or any staff member at UBS that she was interested in changing her investment strategy.
In June 2007, Chan signed different documents, all in English, that included a client acknowledgement form, an "acceptance to be treated as a professional investor" and a "request for subscription of equity-linked notes and blocs."
Chan then transferred shares and cash from her Hang Seng account to UBS, totaling HK$260 million.
In September 2007, Chan says, Wong telephoned and persuaded her to buy a financial product known as an UBS OTC Equity Accumulator.
She claims to have been "induced" into 25 equity accumulator transactions between September 2007 and February 2008.
Last October, a total of nine equity accumulators had not been knocked out, meaning that the stock-price ceiling set in the contract with the bank had not been breached.
After taking losses of more than HK$200 million, she told UBS she wanted to terminate all investments.
As of July 23 this year, her UBS account balance was only HK$1.6 million.
Besides recovering the money, she is seeking interest, damages and costs.
- ► 2013 (307)
- ► 2012 (1270)
- ► 2011 (1873)
- ► 2010 (2369)
07/26 - 08/02
- Re-build the trust in the integrity and reputation...
- Major US financial regulation initiatives
- TKL Sudoku - Challenging Puzzles
- SCMP:Mainland investors claim HK$500m loss on 'mis...
- The Asian Banker:SFC, HKMA and 16 banks reach agre...
- Travel Picks: Top 10 cities to visit with children...
- FISCA Website
- NYT: In search of competent (and honest) advisers
- Great Eastern Life shows the way
- Great Eastern Announces One-time Redemption Offer ...
- SCMP:Investors set for legal fight over lost milli...
- Features of life insurance policies
- Coops in focus in US healthcare debate
- Aging, inequity and poverty
- Expensive car park in Singapore
- Health care realities
- The Health Debate: At a Fever Pitch
- Permits required to appeal to the public for funds...
- Petition to PM on credit linked note (6)
- Pelosi lashes out against insurance companies
- Promote the use of car sharing
- No parking space in HDB estates
- Online Donation towards Gathering on 22 August
- Waiting for the stockmarket to bottom
- BBC; Car insurance premiums rising
- Are you sure democracy cannot help you financially...
- 50% compensation for Minibond
- Company Y not wanting to pay out my insurance clai...
- Gathering on 22 August at Hong Lim Park (2)
- Books and puzzles
- The Standard:Bank wiped out my $260m
- NJ sues Merrill Lynch over $300 mln stock purchase...
- Work near your home
- For the benefit and welfare of the people
- Honesty in Politics
- What is the future for this country?
- Free market - success and failure
- Reuters: Investors dump brokers to go it alone onl...
- NY Times: Of banks and bonuses
- Lehman victims international/ planning for Sep. 15...
- Why markets can't cure health care
- The Standard:61pc of minibond investors undecided ...
- TODAY:We should follow HK's example ; Protect indi...
- Honesty and fairness
- SCMP:Monetary Authority director clarifies minibon...
- Advice on individual shares
- Pensioner Health Benefits
- Interest rate on 25 July 2009
- Winners of Intelligence Quiz and Name The Shape co...
- ▼ 07/26 - 08/02 (49)
- ► 2008 (2105)
- ► 2007 (1803)
- ► 2006 (696)
- ► 2005 (159)