Saturday, March 05, 2011

Lehman Brothers Equity-linked Notes

The Securities and Futures Commission (SFC) and the Hong Kong Monetary Authority (HKMA) announced today that an agreement has been reached with Standard Chartered Bank (Hong Kong) Limited (Standard Chartered) in relation to the bank’s distribution of equity linked structured notes issued and guaranteed by Lehman Brothers (LB ELNs) (Notes 1&2).

Without admitting liability, Standard Chartered has agreed to make a repurchase offer to eligible customers (Note 3) holding an outstanding LB ELN distributed by Standard Chartered. The total value of the repurchase offer is estimated to be approximately HK$1.48 billion and will cover over 95% of the outstanding transactions in LB ELNs by Standard Chartered customers.


My comments
I hope that the regulators in Singapore will follow the example of Hong Kong and take similar action against banks that distribute products that are unsuitable for consumers.

Real estate funds lost value

A Chinese educated investor met me today. She was led to invest in two financial  products by a bank relationship manager on the promise that it was capital guaranteed and had the potential of a good return. After three years, she lost 40% on the investment and found that it was not capital guaranteed. The investor said that she was not aware about the product, as it was in English.

I found out that she had invested in two real estate unit trusts. I was surprised that these two investments lost 40% of the value during the past three years, when the global real estate and stock markets had recovered from the downturn.

I suspect that the investment banks that created the two real estate funds could have put in bad assets at inflated values - which accounted for the large loss. This is an example of the risks of investing in funds that could be created by dishonorable financial institutions who wanted to get rid of their bad assets to unwary investors.

The bank who mis-sold these financial products offered to cover half of the loss "out of goodwill". The investor asked for my views on whether she should accept this offer. I advised her to accept the offer as the decision from FIDREC is likely to be less favorable. She does not have any evidence of the misrepresentation of the product.

Lesson: it is best to avoid funds where the creators of the funds may have some bad assets to offload to investors. These institutions are quite willing to act dishonorably.

Eggs and nuitrition

Here is an article, purported to be written by the top nuitritionist in Malaysia, about the benefit of eggs. TKL Website - Latest.

SGEP Editorial

Read the SGEP editorial at
The last editorial was on 3 March. A new editorial will be updated soon.
There is an archive of past editorials in SGEP information tab.

Looking for a job?

Post your brief resume in Easy Ads for free. Give your postal code and your expected salary. A prospective employer will contact you. This is suitable for people who are interested in part time work near their homes.

PAP enters the digital warfare

There is an article in SGEP that the PAP has entered the digital warfare. I have experienced this event in my blog. Here is what has happened.

I created a survey on "voting at the General Election 2011". I asked the respondent to give one vote per person and to provide their true identity. However, there is no way for me to prevent repeated entries, as I was using Google Forms. All went well during the first day. I received 150 responses. They appear to respect my request for honestly. About 10% were in favor of the PAP, 70% were against and 20% were undecided.

This was followed by 50 consecutive replies that were in favor of the PAP. These replies were submitted by the same person, and were about 30 seconds apart. I decided to close the survey, due to this sabotage. It is digital warfare and done dishonestly.

Click here for the specific SGEP article.

Tan Kin Lian

Good customer service - online team

The Times of the UK shows how to provide good customer service and improve productivity at the same time. Our government agencies and commercial organisations can implement this simple idea. Read TKL website - Latest or  or click here.

Thursday, March 03, 2011

FIDREC should build up trust

Dear Mr Tan
I have just read from your blog on 'Bank Officer Charged On Mini-bonds In China' and this reminded me on your press complaint on 1 Jan 2011 (FidRec needs to build up trust) in which you suggested FidRec or MAS should get an independent organisation to carry out a survey among consumers who have gone through the FidRec process to find out if they felt their cases had been fairly dealt with. Have FidRec or MAS responded to your complaint ?

Neither FIDREC or MAS replied to me. They don't bother.

SCMP: Bank officer charged on mini-bonds

A bank officer in China is charged for misleading customers on investing in the mini-bonds. See this report. Many relationship managers in Singapore have committed similar offenses but are not taken to court here.

General election - survey results

Here are the results, based on responses submitted up to now:

Government to support parenthood

Here are the details of the government plan to support parenthood.
Read TKL website or click here

Shorter working hours - solve unemployment problem

Hi Mr. Tan,
An interesting article on how shorter working hours could be beneficial. Food for thought.

“A much shorter working week could help to tackle a range of urgent and closely related problems: overwork, unemployment, over-consumption, high carbon emissions, low well-being, entrenched inequalities, and the lack of time to live sustainably, to care for each other, and simply to enjoy life. It would enable many more people to join the workforce and allow for measures to reduce damaging levels of inequality….We’d have more time to be better parents, better citizens, better carers and better neighbours. And we could even become better employees: less stressed, more in control, happier in our jobs and more productive.”


I was advocating this approach for a long time as an effective way to solve the global unemployment problem. Each country should set aside a cap on the working hours, so that all its citizens will have access to work. But it requires the country to protect some of its domestic industries from global competition.

Giving back budget surplus to citizens

Compare the Hong Kong way and the Singapore way. No wonder, Singaporeans are confused and say - not enough. We have a convoluted system.

See SGEP or click here

Promise of a better future

We need to bring this government back to focus on the people, their quality of life and the promise of a better future .... Chiam See Tong

High medical cost

Here is a story about how the medical bill to remove a simple kidney stone can amount to USD 12,000 in a private hospital in the USA.  We may be facing a similar situation of over-charging in the private medical practice in Singapore. For elderly people who are not wealthy, it is better to go for a subsidized ward.

Wednesday, March 02, 2011

Rejected insurance claims

This article shows some of the ways that insurance companies can adopt to reject claims. In America, the consumer can find a lawyer to take the case to court. But in Singapore, most consumers are not able to afford the lawyers.

This election, your life, your future

Chiam See Tong talks about the election in his Facebook ...

Direct Asia - cheaper premium rate

Check above site for low cost general insurance quotes. They appear to be extremely low cost ($650 for my Suziki Grand Vitarra versus present nett of $937 paid to Income) but I do not have any clue whatsoever on their reliability, background, credibility etc.

My views
Direct Asia is likely to handle their motor insurance claims as well as any other good insurance company. I expect that their claim handling to be better than average, as they are likely to pay more attention to this line of business and will want to build a good reputation.

Law firm advising a land banking company

Dear Mr. Tan
I am in touch with a few investors who bought land plots from a certain land banking company. The company has since been raided by CAD and they have stopped their operations in Singapore. We have lost our investments entirely. This company was advised by a top legal firm in Singapore. Is it possible for the investors to lodge a complaint to the government or the law society against this law firm for abetting the land banking company to carry out a fraud?

If there are sufficient investors who are willing to come forward, they can lodge a complaint against this law firm. If any investor is willing to join this complaint, please give your particulars here.

Land banking

Hello Mr. Tan

You gave some excellent coverage on UK land banking scams in the past. While such scams no longer seem to be allowed to be promoted in mainstream media advertising in Singapore they are still alive and well. The companies have switched to promoting themselves on jobsites and other unregulated blogs. There are also still cold calls with invitations to attend no obligation events in plush hotels with free gifts. Some companies are even applying for planning permission on UK green belt land plots. Such an application will cost around S$20,000 and might take two years to be rejected including appeals. The application is used as "proof" that the planning approval is "almost there" by unscrupulous sales people.

In order to counter the flurry of pro landbanking blog postings perhaps you could share this list of links with your readers highlighting recent scam awareness activities from the UK related to land investments and land banking.

Man loses £85,000 to land banking scam

Land Banking Scams still conning investors

UK national fraud investigation bureau
"Land banking fraud is when people are conned into buying UK land thinking it will significantly increase in value. Sometimes the valuation of the land on offer is much lower than the quoted price, and sometimes the land being sold does not even exist."
Some unscrupulous sellers have made millions of pounds by duping people into buying unsuitable plots of land at vastly inflated prices. The sellers persuade them that the land has potential to be sold at a profit to developers looking to build houses. In reality the land may  be totally unsuitable for housing and has little hope of ever getting planning permission.

Corruption of middle level leaders

I spoke to an undergraduate from China, who is aware of the social and political issues. He told me that the top leaders in China are generally honest, but there is rampant corruption at the lower levels.

I gave an optimistic prediction. Given time, China will be able to eradicate the corrupt practices, although the task may be daunting. The situation is worse in other countries where the top leaders are greedy for personal wealth and top salaries. They will lose the moral authority to require people at lower levels to behave and act honestly.

Taxi service in Singapore

15 years ago, Singapore had a good taxi service. It was affordable and reliable.

Today, we have a poor taxi service. Our taxi fares are high and the service has become quite unreliable. Prior to the peak hour, taxis are not available. The taxi drivers wait for the peak hour, to be able to levy a 30% surcharge. Taxis are not available in some areas without locality surcharge, but plentiful in other places with the surcharge. There is long queue at taxi stands, but if one is willing to pay a ransom (i.e. the call booking charge), the taxis become available immediately.

We also have a convoluted system of taxi fares, perhaps the most convoluted in the world. Singapore used to be a place with good governance. How did we get into t his sorry state of affairs?

Astronomical fees

It came as a shock to me to learn, through newspaper reports, how much fees are being charged by oncologists (i.e cancer specialists in Singapore). After paying the astronomical fees, many patients still died.

I understand that top lawyers are also astronomical fees - way beyond what an ordinary person can bear. It seems that a senior lawyer will charge in one day, what most people will earn in 3 to 6 months. This type of fees will destroy a society.

I respect the action taken by the Singapore Medical Council to address a recent case of alleged over-charging, but it seemed that the practice has been rampant - from the testimony of the other medical specialists.  How did Singapore get into this sorry state?

It is the duty of the government to govern a society to be fair and just, rather than to have some people get away with as much loot as they can. I hope that more action can be taken against excessive charges, not only by professionals but also business corporations.

Tan Kin Lian

Traffic woes of Beijing

I read that Beijing has a serious traffic congestion issue. There are some roads where the traffic hardly moves. It can take several hours to pass a certain stretch of the road.

Beijing went to the extent of mandating that cars can only be used on alternative days, based on odd or even number plates. How do the rich people in Beijing overcome this restriction? They buy two cars for each driving person in the family with odd and even number plates. The number of cars on the road did not reduce significantly, but the number of cars in the homes increased sharply, adding o the parking woes.But it is boom time for the car manufacturers, who are able to larger market. How wasteful!

The solution is a better system of public transport. The car manufacturers will lobby against it, but if the government is keen to find a solution that is better for the city, they have to push through the necessary measures. A strong government will do it, for the good of the people. I believe that the Beijing government will find and implement this type of solution.

General Election Portal

I have two people helping me in updating the General Election Portal (see I need another volunteer, preferably someone who has an interest in politics and social issues, e..g. undergraduate or graduate in political studies.

Your role is:

  • Read the international and local media and blogs
  • Look for items that fit the interest of Singaporeans on politics and social issues
  • Make a brief summary
  • Provide a link to the main article.
As this is a voluntary job, you can do it when you have the free time. You are expected to spend 1/2 to 1 hour a day, but you can spend more time, if you wish.  See for examples of the work that is expected. You can get a briefing from an existing editor on how to carry out this work.

Interested? Send e-mail to

Tan Kin Lian

Health Subsidy for Singapore citizens

There was a recent case where a Singaporean was denied the subsidy on health care due to an industrial accident. The citizen was not covered by the employer for the accident. The Ministry of Health decided to charge the full rate to the citizen.

I am puzzled by this decision. It seemed that one ministry (i.e. Health) wishes to push the push the problem to another ministry (i.e Manpower) by requiring that the cost should be borne by the employer as it is an industrial accident. The Ministry of Manpower will find it difficult to enforce this requirement, especially for small employers. If the employer is unable to cover this cost, the burden falls on the poor citizen.

It is better for Singapore to have one system to provide for medical expenses, rather than a fragmented system with separate rules for for industrial and non-industrial accidents. We seem to have a culture of pushing responsibility from one ministry to another. Instead of finding ways to reduce cost for the nation, it seems that our civil servants are spending time to find out where to pass the buck. Can someone remind our ministers that they they belong to one Government?

Read this article by Leong Sze Hian in TheOnlineCitizen.

Tan Kin Lian

Fee guidelines - the Brunei Times

THE BRUNEI TIMES, 25th Feb. 2011
It is partly the Singapore Government's fault when they withdrew the Singapore Medical Association (SMA) guidelines for professional medical fees in Singapore a few years ago, saying that it is "price fixing" and is "anti-competitive".
This means today in Singapore, the professional fee is between the doctor and the patient as there is no guidelines to fall back on. If the doctor wants to charge, there is no limit as long as the patient is willing to pay. Hence technically, there is no such thing as "over-charging".
This is a case that appeared in High Court in Singapore a few days ago and it still ongoing:

Tuesday, March 01, 2011

This is home, truly

Kit Chan and revised version

Dr. Susan Lim's bills

Someone sent a letter showing reports in The Brunei Times about Dr. Susan Lim's bills. It has placed Singapore in a bad light and might sour relations with Brunei. Read SGEP - Latest or click here.

I get the nasty feeling that the government acts only because of the complaint by the Brunei High Commission. This will be quite bad. We should act out of a sense of right and wrong.

Financial Planning Talk and Review of Insurance

Hi, Mr. Tan
I really enjoyed the seminar last Saturday. Initially, I had wanted to give the seminar a miss as I did not want to leave my infant daughter at home. Am really glad that my time away from her was well spent!

Before the attending your seminar, I signed up as a member of FISCA. May I know if i can approach a volunteer to vet through a few insurance policies for me? Since the birth of my daughter, we have received quotations ranging with annual premium ranging from $20K to $35K.

Please go to this website ( and do a financial plan. You will get a report that shows the names of two volunteers. You can contact Vincent Sear, as he is knowledgeable about insurance. He will see if he can guide you, for a modest fee.

Wordle - Get Value from your Life Insurance

Pressure seal letters

I dislike the pressure seal forms, e.g. the contract statements sent by SGX and account statements from CPF. I find it difficult to open the statements and usually end up tearing the statements badly, as shown here. I hope that there is a better way, e.g. to end a soft copy by e-mail.

The company that sends the letter finds it convenient, but the recipient finds it quite troublesome. It is call "passing the inconvenience to the next person".

Talking point - no point talking

Read this:

Insuring medical expenses for the elderly

An elderly person needs to set aside only $30,000, if they are willing to be treated in a subsidised ward and has Medishield. See Ask Mr. Tan or click here

Monday, February 28, 2011

Financial products that rip-off consumers

It is easy for consumers to be rip-off by bad financial products. Sometimes, the young people who sell the products are themselves not aware that they are selling products that were designed to cheat consumers. To avoid being rip-off, read this artcile in  TKLwebsite -Latest or click here.

Read SGEP daily

You can get an interesting collection of news from the international media, local media and blogs on the issues affecting the general election in Singapore. There are about 10 new postings each day. Most of the postings are summaries ,but lead you to the source where you can read the full report. Go to SGEP-Latest. Bookmark it for your daily reading. It takes only 5 minutes to get a feel of all the news.

Read the latest SGEP editorial.

Allow professional bodies to set fee guidelines

Published in Today Paper

From time to time, we read about excessive charges by professionals for legal, medical and other services that are levied on consumers. While some cases have been brought to the public's knowledge, I wonder how many other cases do not come to light.

We have now come to a stage where professionals appear to be free to charge what they like in a deregulated, free-market environment. How can consumers know what are reasonable charges and how they are protected?

I urge the Competition Commission to review its stand against professional bodies setting guidelines on professional fees. These guidelines allow consumers to know what the reasonable charges are and still negotiate with the providers for lower fees. The publication of guidelines by professional bodies should be allowed, so long as it is not mandatory on the professionals.

They also allow newly established firms to convince clients they are charging lower fees, as their charges can be compared against the guidelines. This will help the cause of free competition, for the benefit of consumers and ethical professionals. 

Letter from Tan Kin Lian

Sunday, February 27, 2011

Paying for old age

The New York Times published this article about life annuity guaranteed by the state. In Singapore, the CPF Life operates along the same line, although there is no explicit inflation link. But, most people hate CPF Life because they do not trust the government. It is quite sad.

Warren Buffett and home ownership

A house can be a nightmare if the buyer's eyes are bigger than his wallet and if a lender - often protected by a government guarantee - facilitates his fantasy. our country's social goal should not be to put families into the house of their dreams, but rather to put them into a house they can afford.

--- warren buffet, in his 2010 newsletter to shareholders

Family Life Practice (1m)

A new game will be created every 40 mins to allow you to practice this game in the fast mode. Each virtual year takes 1 min and the game is completed in 40 mins. Try it here:

When you are familiar with the game, try the Family Life Challenge (1 game start at 10 am each day) and win the 3-book prize when you reach the top 5 positions during each day.

View these cartoons of Family Life.

Who is better off?

My friend and his wife worked hard and struggle to make ends meet. They have a maid from Philippines who looks after their baby. The maid said that after completing her contract, she would have enough money to build a 3-storey house in the Philippines.  Who is better off? The employer or the maid?

Singaporeans must realize that they have a debt that has to be paid over a lifetime, due to the high cost of housing in Singapore.

Local professors in Singapore

A local professor sent a message to me about the sorry tale of local professors in Singapore. I carried out a survey to ask for reader's comments about the views. 19 replied and 79% agreed with the local professor. See their comments here.

Vote in the general election

Read this article.

High medical fees

Here is a letter from the public about the shocking revelations on high medical fees. How can Singapore become so bad, and doctors can charge so astronomical fees?  

This is why the Singapareans have to vote for a change at the forthcoming general election. It is about the future of our country and our children.

Read SGEP-Latest or here.

At Grave Risk

Read this article. It explains the pain felt by many unemployed people in America. They are not able to find job, even though they are quite well educated.

Let us reflect on the situation in Singapore. Many of our people can find jobs, but the earnings are not sufficient to pay for the high cost of living. Both couples have to work, just to earn enough for themselves. This is why many families cannot afford to have children. Are we better off than America?

Singapore suffers from the same problem as America - a wide gap in income between the top people (who take away too much) and the rest of the population. Both countries follow similar economic policies,i.e. deregulation and free market, that contributed to this big gap. Both countries appeared to be doing well when the housing prices were inflating.

The housing market in America has burst. The housing market in Singapore is still going strong ... but only for the time being. When our housing market burst, we will suffer the real pain.

We have to build our prosperity on real work and not on financial bubbles and inflated asset prices. We are wasteful due to the false sense of prosperity. We tear down buildings that were built 10 years ago. Many of our educated people waste their years of training to work as property and insurance agents, to earn the high commission. The government and big companies spend astronomical sums for infrastructure, buildings, computer systems and management consultants and levy high taxes and fees to recover these spendings.

To avoid the fate of America, we have to reduce the income gap, cut down on the wasteful expenditure and find ways to control the prices, fees, levies and taxes.

Tan Kin Lian

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