2 Nov 2009
HONG KONG - HONG Kong officials said on Monday they have tightened regulation of complicated investment products after thousands of local retail investors were burned by Lehman Brothers-backed derivatives last year.
But lawmakers said the new measures fall short, and urged the government to prosecute banks that misled investors and to ban some risky products outright.
Under the new regulations, banks must issue risk warnings for complex products and record conversations between their sales staff and clients to prevent deception, K.C. Chan, Secretary for Financial Services and the Treasury, said at a legislative hearing on Monday. The government was also considering setting up an investor education body and a financial services ombudsman, he said.
The measures come after 30,000 Hong Kong small investors who bought US$1.8 billion (S$2.5 billion) in Lehman-linked derivatives were left in limbo after the US investment bank collapsed September last year. Upset they weren't fully aware of the risk their investments carried - many of the complex derivatives were innocuously labeled 'mini-bonds' - investors took to the streets.
Hong Kong regulators announced a settlement with 16 local banks in July that returned up to 70 per cent of principal to the buyers, or up to HK$6.3 billion.
Opposition lawmaker Ronny Tong criticised the government for not focusing on legal action. 'I think it's strange that there is not a single case of prosecution after investigating for more than a year,' he said.
- ► 2013 (303)
- ► 2012 (1270)
- ► 2011 (1873)
- ► 2010 (2369)
11/01 - 11/08
- Willing to make decisions
- Hong Kong tightens sale of deriviaties
- Reduce travelling time, cost and congestion
- Intelligence Quiz - Online
- Buying a home
- Rechargeable Torchlight
- Build up the public opinion
- Politics and MRT
- Rechargeable torchlight with locator - as gift for...
- India is worrying about lower demand for jobs
- Broaden the tax base
- GST is unnecessary for Singapore
- Cost of Borrowing
- Rountable on social and political issues
- Congested roads and lost productivity
- Insuring your risks
- Health care system in Taiwan
- Bubble in property market
- Help small business hire again
- TKL Financial Planning
- Patient voices and insurance
- Term Insurance for 25 years
- Exchange traded fund (ETF)
- Freedom of the press
- Rainmakers in Wall Street
- Democracy as practiced in China
- Singapore's public transport lags behind Hong Kong...
- Investing in Life Insurance
- Too big to fail
- Start a Financial Plan
- Loyalty and National Service
- Better, faster and more
- Fourth generation leaders
- Gender of a computer
- Improve the last mile in public transport
- Super Sudoku
- Observation by David Cherbronnier
- Dependent adults - victims or spoiled brats?
- Need to put things right in Singapore
- SCMP:SFC seeks to regulate minibonds
- ▼ 11/01 - 11/08 (40)
- ► 2008 (2105)
- ► 2007 (1803)
- ► 2006 (696)
- ► 2005 (159)