FOR TOP PRIORITY ATTENTION
A RM of a bank called me. He is willing to come forward to sign a statement that he has been giving the wrong information about the credit-linked notes to the bank customers, due to his ignorance. He will be contacting other RMs to come forward and make a similar statement.
He told me that his bank had put pressure on him by stating that he would be held personally responsible to compensate the customers, if he admitted to giving the wrong information. He said that, when he sold the notes to the customers, he was not aware about the actual risks of the notes, due to the complexity of the structure and the poor training given to the RMs.
I told this RM that the bank does not have the right to hold him financially responsible for the honest mistake, especially as most of the other RMs were also poorly trained about these notes. It would be wrong for the bank to expect the RMs to tell a lie now to cover up for the mistakes.
I will arrange for these RMs to get legal advice and to make a statutory declaration about the actual statements and assurances that they gave to the customers about the notes.
I wish to call other RMs to step foward and be ready to make this statement. Please act honestly and with courage, and do what is right and fair. If you are willing to make this statement, send an e-mail to kinlian@gmail.com. I will get a large group of RMs to make this statement, so that you will not be standing alone.
Wednesday, December 17, 2008
Offer of compensation
Some investors are getting offers from the distributor (financial institution) to compensate at 30% of the invested sum. They are given a deadline to accept the offer. If they do not accept, the offer expires and they get a rejection letter from the distributor.
They ask my views on whether to accept this offer. It is difficult for me to give this advice. My view is that a fair offer is 50% of the amount of loss (i.e. difference between the invested sum and the current market value).
Some investors feel that 50% is inadequate and wish to fight for a higher compensation. Other investors feel that they should accept the offer of 30%, as this is the best under the circumstances.
What is your view? Please reply to this survey:
http://www.surveymonkey.com/s.aspx?sm=_2b2e2PBMeL_2bR3lqPs9dmcBQ_3d_3d
They ask my views on whether to accept this offer. It is difficult for me to give this advice. My view is that a fair offer is 50% of the amount of loss (i.e. difference between the invested sum and the current market value).
Some investors feel that 50% is inadequate and wish to fight for a higher compensation. Other investors feel that they should accept the offer of 30%, as this is the best under the circumstances.
What is your view? Please reply to this survey:
http://www.surveymonkey.com/s.aspx?sm=_2b2e2PBMeL_2bR3lqPs9dmcBQ_3d_3d
SCMP:Lehman claims' bill HK$257m
http://www.pressdisplay.com/pressdisplay/showlink.aspx?bookmarkid=2E5GL07SZNL8&linkid=37439ce3-e661-4035-8255-27b3f638efea&pdaffid=8HM4kDzWViwfc7AqkYlqIQ%3d%3d
17 Dec 2008
Joyce Man Joyce Man and Paggie Leung
Seventeen banks have so far paid a total of HK$257 million to settle 616 claims brought by Hong Kong investors in financial derivatives which lost much or all of their value when US investment bank Lehman Brothers collapsed three months ago.
The figures were disclosed yesterday by the Hong Kong Monetary Authority, which said banks were in the process of settling a further 1,000 claims involving investments of HK$429 million.
The authority did not disclose the amounts involved in individual settlements.
Last week, Democratic Party lawmaker Albert Ho Chun-yan said banks had paid HK$ 30 million in compensation to about 60 investors in financial products issued or guaranteed by Lehman Brothers.
The police commercial crimes bureau has received more than 5,000 complaints from investors.
The bureau had taken statements from 2,566 of the 5,184 complainants, the Democratic Party said after party lawmaker Kam Nai-wai met the head of the bureau, Chief Superintendent Chan Yiu-kwok, yesterday.
The bureau was seeking legal advice on whether any crimes may have been committed, Mr Kam said.
He expressed dissatisfaction with the speed with which the bureau was handling the cases, and claimed many of them had obvious evidence of criminality.
Some 43,700 Hongkongers invested HK$15.7 billion in derivatives linked to Lehman Brothers, which sought bankruptcy protection amid the global credit meltdown. Most bought minibonds – high-risk, credit-linked products which derived part of their value from the performance of complex underlying assets.
Many of those who bought minibonds claim bank staff mis-sold them as low-risk investments in wellknown companies.
The Monetary Authority has received nearly 20,000 complaints about Lehman Brothers-related products. It has referred more than 200 to the Securities and Futures Commission for investigation of possible misconduct by banks. It is still investigating another 3,700-plus complaints and is seeking more information about a further 11,072.
17 Dec 2008
Joyce Man Joyce Man and Paggie Leung
Seventeen banks have so far paid a total of HK$257 million to settle 616 claims brought by Hong Kong investors in financial derivatives which lost much or all of their value when US investment bank Lehman Brothers collapsed three months ago.
The figures were disclosed yesterday by the Hong Kong Monetary Authority, which said banks were in the process of settling a further 1,000 claims involving investments of HK$429 million.
The authority did not disclose the amounts involved in individual settlements.
Last week, Democratic Party lawmaker Albert Ho Chun-yan said banks had paid HK$ 30 million in compensation to about 60 investors in financial products issued or guaranteed by Lehman Brothers.
The police commercial crimes bureau has received more than 5,000 complaints from investors.
The bureau had taken statements from 2,566 of the 5,184 complainants, the Democratic Party said after party lawmaker Kam Nai-wai met the head of the bureau, Chief Superintendent Chan Yiu-kwok, yesterday.
The bureau was seeking legal advice on whether any crimes may have been committed, Mr Kam said.
He expressed dissatisfaction with the speed with which the bureau was handling the cases, and claimed many of them had obvious evidence of criminality.
Some 43,700 Hongkongers invested HK$15.7 billion in derivatives linked to Lehman Brothers, which sought bankruptcy protection amid the global credit meltdown. Most bought minibonds – high-risk, credit-linked products which derived part of their value from the performance of complex underlying assets.
Many of those who bought minibonds claim bank staff mis-sold them as low-risk investments in wellknown companies.
The Monetary Authority has received nearly 20,000 complaints about Lehman Brothers-related products. It has referred more than 200 to the Securities and Futures Commission for investigation of possible misconduct by banks. It is still investigating another 3,700-plus complaints and is seeking more information about a further 11,072.
Financial advice
Dear Mr. Tan
Please see newspaper Today B1: MAS clearly said, if a broker recommended aproduct to an investor and convinced the investor to buy the product, then the IFA or broker is not longer acting merely as an introducer or executor but is providing financial advice. In this instance, the relevant provisions of the Financial Advisors Act would apply.
DG
Please see newspaper Today B1: MAS clearly said, if a broker recommended aproduct to an investor and convinced the investor to buy the product, then the IFA or broker is not longer acting merely as an introducer or executor but is providing financial advice. In this instance, the relevant provisions of the Financial Advisors Act would apply.
DG
Means testing for subsidised wards
If you have wish to be treated in a subsidised ward and you have an income that exceeds the means testing level, you will receive a lower level of subsidy. The difference is 15% of the bill.
More details are found here in this article:
http://www.tankinlian.com/articles/health.html
Statement from Ministry of Health website:
http://www.moh.gov.sg/mohcorp/default.aspx
More details are found here in this article:
http://www.tankinlian.com/articles/health.html
Statement from Ministry of Health website:
http://www.moh.gov.sg/mohcorp/default.aspx
Tuesday, December 16, 2008
Downgrade to Medishield
I wish to downgrade from a private Shield to Medishield. I have a lot of trouble with this request.
My enquiry to the insurance company was not properly answered. I was given a form to cancel my private Shield, but there was no mention about the downgrade to Medishield. I have to ask again for them to answer this question.
I search the CPF website. They said that the member can downgrade from a private Shield to Medishield at any time, but did not indicate how this can be done. I have to write to them for instructions - as I am not able to find the instructions in the website.
I prefer to be self-insured and pay out-of-pocket for my hospital charges. However, if the medical charges are very expensive, I can opt to be treated in a subsidised ward.
http://www.tankinlian.com/articles/health.html
My enquiry to the insurance company was not properly answered. I was given a form to cancel my private Shield, but there was no mention about the downgrade to Medishield. I have to ask again for them to answer this question.
I search the CPF website. They said that the member can downgrade from a private Shield to Medishield at any time, but did not indicate how this can be done. I have to write to them for instructions - as I am not able to find the instructions in the website.
I prefer to be self-insured and pay out-of-pocket for my hospital charges. However, if the medical charges are very expensive, I can opt to be treated in a subsidised ward.
http://www.tankinlian.com/articles/health.html
Fair charges on life insurance policy
If a policyholder save $500 a month for 20 years and earn 5% per annum, the gross gain for the period will be $76,000. However, the total deduction to cover the various charges is likely to take away about 45% of this gain. This will leave a net gain of about $41,000 only. This reduces the yield to 2.8%. The reduction in yield is 2.2% (which is rather high).
A fair deduction should be about 25% of the gross gain. This will give a better return to the policyholder, about 4.1%. The reduction in yield is 0.9% (which is quite fair). This reduction is to cover the cost of life insurance, expenses and profit margin.
During the time that I headed a life insurance company, I was able to give a better return to the policyholder by keeping the expenses low and giving a larger share of the profit to the policyholders. They were able to get a better return. The reduction of yield for an endowment policy is about 1%.
Here is a rule of thumb, if you are buying a life insurance policy:
> look at the assumed yield
> look at the net yield, after deducing the charges
> calculate the reduction in yield
> if the reduction is 1% for an endowment policy or 1.5% for a whole life policy, the yield is fair.
> if the reduction in yield exceed these benchmarks, the charges are probably too high.
You can ask the insurance agents to point out these figures that should be shown in the benefit illustration for the policy.
A fair deduction should be about 25% of the gross gain. This will give a better return to the policyholder, about 4.1%. The reduction in yield is 0.9% (which is quite fair). This reduction is to cover the cost of life insurance, expenses and profit margin.
During the time that I headed a life insurance company, I was able to give a better return to the policyholder by keeping the expenses low and giving a larger share of the profit to the policyholders. They were able to get a better return. The reduction of yield for an endowment policy is about 1%.
Here is a rule of thumb, if you are buying a life insurance policy:
> look at the assumed yield
> look at the net yield, after deducing the charges
> calculate the reduction in yield
> if the reduction is 1% for an endowment policy or 1.5% for a whole life policy, the yield is fair.
> if the reduction in yield exceed these benchmarks, the charges are probably too high.
You can ask the insurance agents to point out these figures that should be shown in the benefit illustration for the policy.
Fair compensation from insurance companies
Dear Kin Lian,
Here are two articles from Bloomberg News. They illustrated the tactic employed by insurers in U.S, as taught by Mckinsey.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=auNrNZBzb1NE
http://www.bloomberg.com/apps/news?pid=20601170&refer=home&sid=aIOpZROwhvNI
One paragraph said: "State Farm changed its approach to settling claims after
McKinsey & Co., a New York-based consulting firm, told the insurer it could increase profits by paying out less in auto accident claims and home disasters, according to evidence presented in civil court cases."
Another paragraph said: " When a policyholder files a claim, first make a low offer,
McKinsey advised Allstate. If a client accepts the low amount, Allstate should treat the person with good hands, McKinsey said. If the customer protests or hires a lawyer, Allstate should fight back."
I hope local insurers won't adopt the same approach for more profit. Please take good care of yourself.
Dennis
Here are two articles from Bloomberg News. They illustrated the tactic employed by insurers in U.S, as taught by Mckinsey.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=auNrNZBzb1NE
http://www.bloomberg.com/apps/news?pid=20601170&refer=home&sid=aIOpZROwhvNI
One paragraph said: "State Farm changed its approach to settling claims after
McKinsey & Co., a New York-based consulting firm, told the insurer it could increase profits by paying out less in auto accident claims and home disasters, according to evidence presented in civil court cases."
Another paragraph said: " When a policyholder files a claim, first make a low offer,
McKinsey advised Allstate. If a client accepts the low amount, Allstate should treat the person with good hands, McKinsey said. If the customer protests or hires a lawyer, Allstate should fight back."
I hope local insurers won't adopt the same approach for more profit. Please take good care of yourself.
Dennis
REPLY
I will explore giving the proposed Financial Services Consumer Association (FISCA) a role to help members get fair compensation for their insurance claims. This will make it more valuable for members to join FISCA. This service will be available for existing members only, in respect of a claim that arises after they have joined FISCA.
Search for a private property
I started to search for a private property, as the property prices must have corrected. I went to StreetSine and found it to be very useful. Here is the link:
http://www.streetsine.com
I looked for new condominium projects in districts 1, 2 and 3 and saved them in MyOrganiser. I looked at each project, to see the price trends and the properties available for sale. Several of the projects have shown a 20% reduction in price in recent months. The price may fall another 10% to 20% more, but it is time to understand the market.
There is a useful SQI index which gives points for the amenities in the nearby areas. Most importantly, I could see the map and the distance to the MRT station.
I was able to view "List Nearby Properties" to see the properties that are available for sale. I was able to send a SMS to the advertiser, which is usually a property agent. This is a convenient way to search for a property.
http://www.streetsine.com
I looked for new condominium projects in districts 1, 2 and 3 and saved them in MyOrganiser. I looked at each project, to see the price trends and the properties available for sale. Several of the projects have shown a 20% reduction in price in recent months. The price may fall another 10% to 20% more, but it is time to understand the market.
There is a useful SQI index which gives points for the amenities in the nearby areas. Most importantly, I could see the map and the distance to the MRT station.
I was able to view "List Nearby Properties" to see the properties that are available for sale. I was able to send a SMS to the advertiser, which is usually a property agent. This is a convenient way to search for a property.
Offer of voluntary assistance
Mr. Paul Smith wishes to offer voluntary assistance to anyone who needs help in the following areas:
> writing complaints to banks
> writing complaints to FIDREC
> give moral support
> attend interview with bank or FIDREC
If you need his help, you can e-mail him at stopdisc@hotmail.com
BACKGROUND
Mr. Smith's wife invested in a credit linked note. She had a difficult time to making the complaint to the bank. Mr. Smith helped her during the process. He finds that the bank did not treat the customer fairly. He now wishes to offer his voluntary assistance to other customers who faced similar difficulty.
Mr. Smith is willing to help the investor in the interview with the bank or FIDREC, but he needs the investor to sign a mandate for him to attend the interview.
> writing complaints to banks
> writing complaints to FIDREC
> give moral support
> attend interview with bank or FIDREC
If you need his help, you can e-mail him at stopdisc@hotmail.com
BACKGROUND
Mr. Smith's wife invested in a credit linked note. She had a difficult time to making the complaint to the bank. Mr. Smith helped her during the process. He finds that the bank did not treat the customer fairly. He now wishes to offer his voluntary assistance to other customers who faced similar difficulty.
Mr. Smith is willing to help the investor in the interview with the bank or FIDREC, but he needs the investor to sign a mandate for him to attend the interview.
Monday, December 15, 2008
Distributor can recover the compensation from the issurer of the credit linked notes
Some investors asked me if they can expect the distributor to compensate for 50% of the loss, when they only earn 3% to 5% as commission to distribute the product. Perhaps 30% is adequate.
I suggest that the distributor should compensate 50% and get the subrogation rights to recover their loss from the issuer of the credit notes. Apart from Lehman Brothers, the other issurers are still in business and are able to compensate the distributors. The distributors can also seek to recover their loss from the receiver of Lehman Brothers.
By acting in this manner, the distributors will be able to win back the trust of their customers, and also reduce their actual loss.
I suggest that the distributor should compensate 50% and get the subrogation rights to recover their loss from the issuer of the credit notes. Apart from Lehman Brothers, the other issurers are still in business and are able to compensate the distributors. The distributors can also seek to recover their loss from the receiver of Lehman Brothers.
By acting in this manner, the distributors will be able to win back the trust of their customers, and also reduce their actual loss.
AsiaOne: Slip sliding into depression
BY DHANY OSMAN
..'With the economic downturn, it's important to help people keep things in perspective and not catastrophise,' he said.
That is what Ms Tan (not her real name), a communications executive, 50, has been doing.
She lost $50,000 in investments in DBS High Notes 5.
She said she kept the news from her husband for fear of starting a fight and lost a lot of sleep wondering how she would pay for her younger child's university education.
Ms Tan said she felt worse when she realised that she might either have to borrow money or delay retirement to make up for the loss.
Being in control of the family finances made it easier for her to keep her worries to herself although she felt the stress each time her husband talked about money.
It left her feeling mentally weary and constantly distracted. However, with support from relatives who lent a listening ear and by making a concerted effort to think positive, she has since recovered her spirits.
'I certainly was upset at first. But after a point, I felt it was time to move on and not dwell on the loss,' she said.
http://health.asiaone.com/Health/Wellness%2B%2540%2BWork/Story/A1Story20081212-107323.html
..'With the economic downturn, it's important to help people keep things in perspective and not catastrophise,' he said.
That is what Ms Tan (not her real name), a communications executive, 50, has been doing.
She lost $50,000 in investments in DBS High Notes 5.
She said she kept the news from her husband for fear of starting a fight and lost a lot of sleep wondering how she would pay for her younger child's university education.
Ms Tan said she felt worse when she realised that she might either have to borrow money or delay retirement to make up for the loss.
Being in control of the family finances made it easier for her to keep her worries to herself although she felt the stress each time her husband talked about money.
It left her feeling mentally weary and constantly distracted. However, with support from relatives who lent a listening ear and by making a concerted effort to think positive, she has since recovered her spirits.
'I certainly was upset at first. But after a point, I felt it was time to move on and not dwell on the loss,' she said.
http://health.asiaone.com/Health/Wellness%2B%2540%2BWork/Story/A1Story20081212-107323.html
Sunday, December 14, 2008
Helplines - for managing mental stress
Samaritans of Singapore (SOS. 24 hrs) 1800-221-4444
Singapore Association for Mental Health Helpline 1800-283-7019
Care Corner 800 Hotline (in Mandarin, 10am-10pm daily) 1800-353-5800
Touchline Mon-Sat (10am-10pm)(for 13 to 25 year olds) 1800-377-2252
BABES (For teenage girls facing pregnancy crisis) 1800-833-6666
Pregnancy Crisis Service Mon-Fri (9am-5pm), Sat (9am-1pm) 6339-9770
Association of Women for Action and Research Helpline (AWARE) Mon-Fri (4pm-10pm) 1800-774-5935
National Family Service Centre (FSC) Helpline 1800-2255-372
SENIORS helpline (for older persons and their care-givers) 1800-555-5555
TOUCH Caregivers Centre 1800-352-1622
SAGE helpline Mon-Fri (9am-5pm), Sat (9am-1pm) 1800-3538633
Alcoholics Anonymous 6475-0890
Eating Disorders Helpline - Tel: 6345-3435 (10:00am - 4:00pm Phone Mail Mon-Fri
Source : http://www.giftoflistening.com/resources.html
Singapore Association for Mental Health Helpline 1800-283-7019
Care Corner 800 Hotline (in Mandarin, 10am-10pm daily) 1800-353-5800
Touchline Mon-Sat (10am-10pm)(for 13 to 25 year olds) 1800-377-2252
BABES (For teenage girls facing pregnancy crisis) 1800-833-6666
Pregnancy Crisis Service Mon-Fri (9am-5pm), Sat (9am-1pm) 6339-9770
Association of Women for Action and Research Helpline (AWARE) Mon-Fri (4pm-10pm) 1800-774-5935
National Family Service Centre (FSC) Helpline 1800-2255-372
SENIORS helpline (for older persons and their care-givers) 1800-555-5555
TOUCH Caregivers Centre 1800-352-1622
SAGE helpline Mon-Fri (9am-5pm), Sat (9am-1pm) 1800-3538633
Alcoholics Anonymous 6475-0890
Eating Disorders Helpline - Tel: 6345-3435 (10:00am - 4:00pm Phone Mail Mon-Fri
Source : http://www.giftoflistening.com/resources.html
Coping with rising health care cost in Singapore
Read this article:
http://www.tankinlian.com/articles/health.html
And the discussion in The Online Citizen
http://theonlinecitizen.com/2008/12/dont-save-face-go-to-c-class-wards-says-tan-kin-lian/#comments
http://www.tankinlian.com/articles/health.html
And the discussion in The Online Citizen
http://theonlinecitizen.com/2008/12/dont-save-face-go-to-c-class-wards-says-tan-kin-lian/#comments
Mental depression and suicide
Dear Mr Tan KL,
I refer to the following comments in your post
http://tankinlian.blogspot.com/2008/12/hk-mom-suiside-because-bank-refuse-to.html
Anonymous said...
I have thought of suicide as well. The way MAS and government have acted in not helping me, I feel really depressed. Each time I see the words UOB Kay Hian I have much resentment and depression that I have lost the family's life savings. If it goes on this way and I do not get back the money, I can't face the family and subject them to difficult life ahead. Worst, I have no regular job now. It only takes me some courage to kill the children and end my life with my wife. Never felt so miserable in my life. Now I understand what depressing life a 40+ has when there's no job and money but full of life stress.
If we end our life, I will make it clear we will return to haunt UOB Kay Hian and those responsible for minibond.
Anonymous said...
I can feel how you are feeling now, as I am also in the same situation. However,if you are gone now, the FIs won't feel bad. You must transform your anguish into energy to fight. Not only for yourself and your family, but against your enemy who had put you in this agony.
I'm concerned that these two victims are so depressed as they've been pushed to a dead end and may resort to some foolish act. If you have volunteers who are well trained in counselling pls help them to overcome this difficult period.
tkh
REPLY
For those who need conselling help, please refer to any of the organisations shown in the attached blog:
http://tankinlian.blogspot.com/2008/12/helplines-for-managing-mental-stress.html
I refer to the following comments in your post
http://tankinlian.blogspot.com/2008/12/hk-mom-suiside-because-bank-refuse-to.html
Anonymous said...
I have thought of suicide as well. The way MAS and government have acted in not helping me, I feel really depressed. Each time I see the words UOB Kay Hian I have much resentment and depression that I have lost the family's life savings. If it goes on this way and I do not get back the money, I can't face the family and subject them to difficult life ahead. Worst, I have no regular job now. It only takes me some courage to kill the children and end my life with my wife. Never felt so miserable in my life. Now I understand what depressing life a 40+ has when there's no job and money but full of life stress.
If we end our life, I will make it clear we will return to haunt UOB Kay Hian and those responsible for minibond.
Anonymous said...
I can feel how you are feeling now, as I am also in the same situation. However,if you are gone now, the FIs won't feel bad. You must transform your anguish into energy to fight. Not only for yourself and your family, but against your enemy who had put you in this agony.
I'm concerned that these two victims are so depressed as they've been pushed to a dead end and may resort to some foolish act. If you have volunteers who are well trained in counselling pls help them to overcome this difficult period.
tkh
REPLY
For those who need conselling help, please refer to any of the organisations shown in the attached blog:
http://tankinlian.blogspot.com/2008/12/helplines-for-managing-mental-stress.html
ERP and MRT in Singapore
By courtesy of Loh Hon Chun:
Even Adolf Hitler complains about the ERP and MRT in Singapore. http://hongjun.blogspot.com/2008/09/hitler-complaining-about-erp-and-mrt.html
Even Adolf Hitler complains about the ERP and MRT in Singapore. http://hongjun.blogspot.com/2008/09/hitler-complaining-about-erp-and-mrt.html
Video of my speech at Speaker's Corner - 13 Dec 2008
View the video recordings of my speech here:
http://theonlinecitizen.com/2008/12/mr-tan-investors-consulting-lawyers-and-exploring-legal-options/
http://theonlinecitizen.com/2008/12/mr-tan-investors-consulting-lawyers-and-exploring-legal-options/
Last Meeting on Speaker's Corner, 27 Dec 2008
I will be holding the last meeting at Speaker's Corner on 27 December 2008.
The separate groups, according to the product (e.g. minibond, high notes) will be holding their seperate meetings at their preferred locations. If you are interested to join the group, you should contact the group leader.
I will use my blog to update the investors on subsequent developments regarding the legal action and other matters.
The separate groups, according to the product (e.g. minibond, high notes) will be holding their seperate meetings at their preferred locations. If you are interested to join the group, you should contact the group leader.
I will use my blog to update the investors on subsequent developments regarding the legal action and other matters.
Saturday, December 13, 2008
Public transport in Singapore
I have resumed my postings in this blog:
http://singaporepublictransport.blogspot.com/
Do visit it regularly and give your feedback and views.
http://singaporepublictransport.blogspot.com/
Do visit it regularly and give your feedback and views.
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