Monday, February 16, 2009

Rejection letters from financial institutions

Many note holders (of mini bonds, high notes, pinnacle notes, jubilee notes) are getting rejection letters from the financial institutions.  They are disappointed. They wish to take legal action. 
I am getting e-mails from these investors. It is quite discouraging to see so many people who are disappointed with the decision of the financial institutions.
Here is a comment:
The most insulting part is that we all got form letters, and not even one word of explanation was given. That is why the XXX brand stand for, cruelty and arrogance. No one in my family and no one that came after me will even bank with this brand.


Nick said...

From FI's perspective, they are selling the product in accordance to Mas guideline and so long the investor is not 62 and above and is educated, the standard form of rejection will be given.

Why? Reason is simple. The problem with all these CLN is the execution of them. During sales, REs are known to be 6-7 but during execution, another set of 100-150 REs are used for credit protection by us (investor). And Mas is only getting independent party to look into the selling process and not the product execution, which is the MAIN point of the problem.

All rejection victims should be united to write to Mas to start investigation on the product execution in order to bring the truth and justice.

Parka said...

Precisely. So much for the transparency. If no reasons are given, why even put up a show of going through with the interviews? Basically they can just do whatever they want.

Anonymous said...

Mr Tan,
I disappointed by the rejection from my bokerage firm and wish to pursue class action. Can you advise who should I contact?

Mr Lee

Anonymous said...

We are advised by MAS to follow the recommended process of lodging our complaints with the FIs. In the process each of us got "interrogated" by the FIs' staff and submitted a statement detailing our side of the story regarding the transaction and listing the basis of our complaint. We bare it all to the FIs to facilitate the investigation process. It is our expectation that the FIs will level the playing field when making its final decisions and will reciprocate with the reasons for the decisions particularly when they are to reject the complaints.

Now, we see and hear that the FIs are not honouring this en masse and their rejection letters come with a complete silence on their reasons. How are the complainants going to assess the merit of the FIs' positions and hence decide whether they will discontinue with the complaint process or to proceed to the next recommended step of going to FIDREC.

I urge every one who receives reject letters with no reasons attached to lodge a complaint on this with MAS and let them be aware of the prevalence of this injustice and bully-stance of the FIs. In a court of law, a judge will give the reasons for his judgement. Why should FIs be allowed to act otherwise and unfairly? Are the FIs not confident that their positions are on solid ground or is this a ploy to hide their faults and steamroll themselves through?

Anonymous said...

MAS reported that 75% of minibond investors got compensation from banks. For ABN (RBS), the figure is probably far less than 75%.

Anonymous said...

The program "House Of Cards" now (16/2 9pm) showing on CNBC channel interviewed Alan Greenspan who said even he, who has a strong maths background, is bewildered by these CDOs which are the toxic assets packaged into Structured notes and sold to us. How do they expect ordinary folks like us to understand what was sold to us under disguise of AAA rated Companies???

Anonymous said...

They do this because they are what they are.

We folks still have a lot to learn about the ways of the world and the system.

Anonymous said...

Fellow intoxicated victims,
The Complaint Handling process is wrong from the beginning.

[1] Mis-selling is a breach of statutory obligation of FI, which should be investigated by MAS as delegated by Fin Adv Act.
[2] Investors bare all facts in the Complaint lodged; but during the interview, FI only asks for more information and did not reveal FI's position. This is not an interview bec interview means 2-way traffic. 1-way interview by FI on investors is INTERROGATION even it is done in politeness.
[3] It is unfair when FI offers or rejects compensation without reasons. This is because Investor state the facts of their claims; whilst FI can be silent!
[4] If Investors reject the offer and goes to Fidrec, no matter how unfair it is, the original offer will vanish. Investors are cornered because the original tenets of fairness stipulated by MAS cannot be carried without intervention.

When Justice is not upheld, that will be the end of trust and respect. There is a Chinese saying, "water carries ship; and sinks ship at the same time."

From. Structured KuKu

Anonymous said...

let me leave a comment or two; frm e begining, class action shuld hve commence, e practice therein SE is high handed with no support frm relevant authorities;let alone getting ur money back, when will SE will up to reality of 'justice' in this regime land...when u commence class action; e level of attentn shall enough to warrant serious consideration by all parties including authority in name of 'financial competence' & uphold e name of free market, espcially in SE, so the merry go round shall take years if kind enough for any settlement, why did u waste so much time to bck e beginnng of e circle..wake up! or else, live with fate, it ur choice that you had invested...

Falcon said...

In any negotiation process, the more one party knows about the other party is an advantage. Conversely, the less the other party knows about oneself, the greater the advantage. So obviously when you detailed your story, it is going to be used for the other party's advantage because whatever you have said is taken as evidence and you cannot later say a different thing or your credibility will suffer. By not giving their reasons, they have limited your knowledge so that is why you are now in a situation where you feel you are losing control and not sure what to do. Even if you sue them now, you are already at a disadvantage. If your case goes to court, their lawyers can study what you said closely and devise a strategy to win the case by dissecting what you have said and find any loophole or wrongdoing on your part. Your poor lawyer will not have the same leverage as he will not even know what the other side is thinking.

Anonymous said...

You are RIGHT to say .. "So obviously when you detailed your story, it is going to be used for the other party's advantage .."

You are WRONG because the Investors are following MAS 3-step approach, announced to the public and debated in parliament.

You are right and wrong, but investors are KU KU.

FROM Structured Ku Ku

Anonymous said...

I think we know when a policeman catch a criminal ,he will read out the right to him.That is some sort like "you
have the right to remain silence
what you say will be use as evidence.....
That why now the FI have all data's of your complain.which FALCON have said in his blog

Anonymous said...


My name is James. I had just received my rejection letter from MayBank on the compensation for missold of MINIBOND Series 6 by their banker to me. I will type out the detail of the letter below for you all to read. Please give me your view and advise what I should do next? Do you think FIDREC is able to help me ? Can MAS be trusted to help the victim like us? Can something be done collectively with all the affected victims to get justice on this.

This is the content of the letter that I receive from Maybank:

Dear Mr. XX


We refer to your investment in the Minibond notes and our subsequent interactions.

We regret to inform you that we are unable to accede to your request for compensation on your above-mentioned investment. We have looked into your case and we are of the view that, based on our investigation, your allegations are not substantiated, whether by documentary evidence or otherwise. Your case had been reviewed and assessed based on an independent and fair process set up to handle and resolve complaints from Minibond investors. This process was also overseen by an independent party as required by the Monetary Authority of Singapore.

If you are satisfied with our decision and wish to have your request further assessed, you may wish to approach the Finance Industry Disputes Resolution Centre Ltd ('FIDREC') which is set up to mediate and resolve consumers' complaints against financial institutions.

Please be informed that under FIDReC's Terms of Reference, you should lodge your case with FIDReC within 6 months from the date of this letter, failing which FIDReC will not be able to handle this claim. If you have any queries on the dispute resolution process by FIDReC, you may contact them on (65) 63278878 or via email at

You may submit your claim directly to FIDReC. Alternatively, if you require our assistance to submit your case on your behalf to FIDReC, please contact our Customer Care Centre on 65507654.

Yours Sincerely,

Customer Care Centre

CC. The Monetary Authority of Singapore

Anonymous said...

wow, maybank is good. They actually gave you an explanation, unlike RBS (ABM). All of us rejectees received just form letter without one word of explanation.

Anonymous said...

Wow, different FI but identical wordings and reason! Did they meet up with MAS and came up with 'standard' reply - 'unable to accede to your request for compensation'; 'your allegations are not substantiated'.

Anonymous said...

seems like HlF is more generous in compensating its customers...i support HLF... :)

Falcon said...

Structured Ku Ku posting as anon:

There is no right and wrong here. I was merely sharing what I know about effective negotiation. It can help your position or hinder it. When one wants to negotiate, it helps if one is in a stronger position. A strong position is one where you know what the other party is thinking and his bottomline while preventing the other party to know your strategy and bottomline.
That is why when someone wrote to ask about Mr Tan's strategy I thought it would not help the investors here if you openly discuss your strategies and your bottomlines. Do it behind closed doors if you want your position to be stronger.

Anonymous said...

The decision by the bank is based on your verbal 'evidence" of mis-selling and there is no documentary proof of that. Since you were not given a copy of the fact finding form which you purportedly signed it is hard to prove it.
Get hold of one copy and which you were entitled to when you bought the bond. In it there bound to be evidence of miss-selling. Get an expert financial planner to help you.Coupled with RMs to testify for you, you will be able to raise enough evidence to show that y0u were misled into buying .
Class action should use this strategy to pin down the FIs.
Expert financial witnesses and RMs are key to winning the case

Concerned said...

Amongst all the FIs, HLF is the most generous and fairest in their compensation. Investors, their families and friends should shunned FLs who do not compensate them fairly.

Anonymous said...

Here is the brokerage version of "standard" rejection letter.

Dear XXX,
Lehman Minibond investments
Thank you for providing further details of your purchase of XXX, which has been executed through XXX. It is regrettable that the recent unforeseen market developments have affected the value of your investments.

The information you have kindly provided has enabled us to undertake a thorough investigation of your case. Following careful deliberation of the information provided to us, we regret to inform you that we found no grounds to accede to your request stated in your communication to us. Nor are we able to propose any other form of settlement.

If you wish to pursue your complaint despite the above, you may consider submitting your case to the Fidrec for mediation or adjudication.

Please contact us at xxxx or email us at xxxx if you require further assistance.

Yours sincerely,
Head Customer Service

Anonymous said...

I think the real substance in the letter is "your allegations are not substantiated, whether by documentary evidence or otherwise" and the rest are repetition the government official statement.

My proposal: It depends on how you documented your complaint.
[1] You should write a letter to MAYBANK requesting for point-by-point rebuttal, which I think it is FAIR.
[2] If MAYBANK does reply, then you can take on from there.
[3] If MAYBANK does not reply, then that speaks volume about the FAIRNESS of the process.
[4] In any case, you have to go to FIDREC, because this is the government position and your only option.
[5] Pray to God for justice and peace [I say it sincerely, because only divine can deal with injustice.]

If my wife has the same treatment with her complaint, I would do the same above.


Anonymous said...

Dear Cashew Nut,

I did as what you suggested, and cc my letter to MAS, but the FI just ignored my questions again and again and send me the same letter said they rejected my compensation and asked me go to Fiderc.

The funny thing is, my question is very clear, " can I go to Fiderc since my amount is more than 50K?" Is my question not clear enough? THey just ignor this question again and again but sent back me the standard letter "they rejected my claim and asked me go to FiderC.

What can you do for this machined made letter?

Anonymous said...

There is no fairness in the process. Following my rejection letter, I asked for a point by point reply to my specific complaints raised in my complaint letter. UOBKH gave no reply. They just ignore you. I am just waiting for the class action to take them to court.

Their brokers and management cheated in their exam, that says so much about their integrity.

Anonymous said...

I must say HLF has shown their gesture of goodwill. We are given till end March to decide on the settlement agreement. The 6 weeks gives us ample time to consider the settlement.

Anonymous said...

Looks like HLF is the best of lot. They have made provisions to settle the claims. Looks like they are quite principled. RBS ( ABN AMRO) send out standard reply without even bothering to give giving any reasons for rejecting the claim. Wonder if it is because being a foreign bank they don't give 2 hoots. Maybe they think the MAS won't dare to do a thing to them because they can pack up and go or also perhaps because they think MAS has also messed up in agreeing to let them sell the minibonds. Looking at their marketing brochures, it seems that the intent to mislead is evident. Not something you would expect from a well established, principled bank. The question is does MAS have the integrity take further actions if the banks choose not to play fair. Will MAS investigate & even prosecute if there is a possible wrong committed regardless of whether they may be implicated in the process?

Anonymous said...

I think Maybank is more open and considerate to their investors, based on their rejection letter wording and stating the Fidrec contact number for clients convenience.

HLF appears to be compensating the bulk of their MB clients, on differing percentages. But it is interesting to note that their offer to buy back the MB product from clients comes without any admission to wrong-doing on their part. It is more out of reputation and goodwill, especially for clients with no past investment experience.

Anonymous said...

How do we go about in pursueing class action. Apparently, not much info. is being discussed. Could someone advise....

Falcon said...

Mr Tan has posted repeately in his blog that the first step is for the affected investors to contact the respective contacts based on the different products. The contact emails and telephone numbers were also given.
It is not to your advantage to openly discuss your strategies and options here.
All affected investors do contact the respective contacts and you can then strategise from there.

Anonymous said...

You wrote "They just ignore this question again and again but sent back me the standard letter ... What can you do for this machined made letter?". My comment : -
[1] Ask MAS because your letter is copied to MAS.
[2] Leave it to divine intervention because the problem of the machined-made letters come from machined-made men and women behind them.

FROM Cashew Nut

Anonymous said...

Some kept saying HLF is fair, but I've not seen or heard anyone being compensated by HLF.

My mother's $100K investment with them has not yet received a decision from them for a good 3 months after the "interrogation".

Those who say HLF is fair, care to substantiate?

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