Andrew Loh / Deputy Editor
Click here to visit TOC Youtube for the videos of the event. Also, see below for a South China Morning Post report on what the authorities in Hong Kong are doing.
In his fourth appearance at Speakers’ Corner in as many weeks, Mr Tan Kin Lian announced that 1,017 people have signed the petition to the Monetary Authority of Singapore (MAS). It is the fourth petition which Mr Tan has initiated to help investors who are affected by the discredited structured products.
The petition calls for “fair compensation” for investors of failed credit-linked securities who were “misled by sales reps and/or sales material” which described the products as low risk. It also calls on the MAS to restore investor trust in the financial institutions (FIs) and Singapore’s international reputation as a financial hub.
The crowd of about 500 people applauded after Mr Tan finished reading out the petition.
Mr Tan revealed that he has asked for a meeting with MAS chairman, Mr Goh Chok Tong, next week to hand him the fourth petition. He also wants to ask Mr Goh about the progress of the call that was made in the first petition which asked the Commercial Affairs Department (CAD) to look into possible mis-selling by the banks. “I’ve also asked a Member of Parliament to bring it up in Parliament,” Mr Tan told the appreciative crowd.
In his speech, the former Chief Executive of NTUC Income suggested that investors of different structured products request meetings with the top management of the FIs. Observing that the investors of DBS-sold products were “very organised”, he urged the rest to do the same. DBS investors have had meetings with the management in recent weeks.
Turning to the issue of legal action and collective action, he said that he has met with two lawyers about it. They advised that if such actions were to be taken, investors needed to start preparing now. The lawyers will be giving briefings to investors about it, Mr Tan said. However, he cautioned that legal actions should be the last thing that investors considered.
He hopes that the MAS will provide what he called “common guidelines” so that legal action can be avoided.
Guest speaker at the event, Madam Ng Ah Mun, 68, took to the stage to share her experience as an investor. She told the crowd that she had invested $100,000 in a local bank’s Star Track products in 2003. Over the five years since, she has only made a net profit of $2,928. Armed with copies of correspondence she has had with the officers of the bank and banners which she made herself, the retired teacher was furious about being “cheated”. “Don’t enter a bank,” she said, “enter at your own risk.” (Watch the video of her speech here.)
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Part One of Mr Tan Kin Lian’s speech. Click here for TOC Youtube for the rest of the videos. The transcript of Mr Tan’s speech can be found on his blog here.
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In Hong Kong… click on picture to read the South China Morning Post report.
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Mr Goh Chok Tong are you free?
you have taken so much salary and benefits as a civil servant.
when are you going to repay to the singapore citizen?
May i know who is the MP? And will he really dare to bring up the case?
Although CASE has announced that they will help victims to sue banks, please be careful with your dealing with banks.
All government-affiliated organisations have been responding very slowly towards the entire MAS-DBS-Lehman incident. If any, CASE would seem to be diluted Tan Kin Lian´s effort and diluting the litigation effort by Tan Kin Lian and Glenn Knight to take up banks to court.
There can only be one champion, and so far, only ONE champion has led the way for you. You know who. Choose wisely.
Only in unity, we find strength. Without unity, we are nothing!
parliamon people representatives should be thankful to TKL for doing some of the initial work for them, maybe in an indirect way ?
more family time for one and all. huray!
Daniel Tan on November 1st, 2008 8.44 pm
Only in unity, we find strength. Without unity, we are nothing!
Yes, only through unity that we can stand firm to do the right things as one big family, as one big organization and as one BIG nation of singapore.
Of 10 000 pocket hurt people, 10% signed petition only even after 1 month of HLPark meetings.
Sadly and regretably, I believe the rest of the 90% are those whom I pitty the most .
Many of these 90%, I would think, are the ’smartest’ type in that they know better than everyone else, any attempt will be futile based on their life experience.
Unbeknownst to these lot, there is a significant difference between having tried and being too ’smart’ based on their life experience and not even done anything about it.
For example : 10 000 signed the petition , fought and fought and fought on. down the road, people gave up one by one, cannot sustain the ‘battle’. People become aware of the on-goings and their attempts and ‘battles’ and sufferings.
Versus : no one signed, case closed on day 1. All peace and quite, waiting for xmas and enjoy like IT NEVER HAPPENED.
Tell me , comparing the 2 pictures above, what is the difference? Even kids watching sessame street can spot the diff.
As said, having visited the sites and witnessed the victims and listened to them, I have learnt the sad truth and reality – People are really over Trusting not sure why? Culture? Nurture? Environment? you tell me. And People are really scared, about more than just money, if you know what I mean.
Compare HK and Singapore – the uniqueness of Singapore is proven beyond any doubt. The world understands now.
Farewell in advance, has ta las vista babe and more good decades one and all, retire as you planned and dont get cheated ever again and live happily ever after.
All hope is gone until 50 years later , but then, these are just my views. You think however you desire.
I have 1 more observation : many investors are really not english educated and worse, not Internet savvy. They never use the internet to know of TKL blog or TOC. Many not even aware of TC investment .
how net savvy and IT literate are people ?
Thank goodness they are not right? Else….look at Malaysia ;)
The peoiple who read my blog are English educated and computer savvy. They help to pass the word around by word of mouth to their relatives and friedns who are Chinese educated or not computer savvy.
We can use the power of the internet to reach out to a wider group of people.
Hi Daniel Tan (#3)
We should welcome the effort by CASE and by SIAS to be involved in this matter. I have encouraged the investors to reach out to these organisations in past postings in my blog.
I also encouage the investors to see their Members of Parliament.
I am personally not able to handle the complaints of more than 1,000 people. We should try all channels.
Petition #4 ask MAS to encourage the financial institutionsto reach a collective settlement with their investors. If these institutions are keen, we can organise a meeting with representatives of the institutions and the investors to reach out some guidelines that are fair to all parties. I beleive that most investors will be willing to agree on these guidelines, rather than the “case by case” approach.
Some investors expect 100% compensation. That is unrealistic. I hope that they will agree to some compromise.
Tan Kin Lian is giving these 10,000 investors majority uncles and aunties false hope to get their money back. The Banks who sold them the Lehman bonds only earn a fees maximum 5% and it is unfair to ask these Banks to pay back the full amount. Singapore is an open economy and is not a welfare state, and these uncles and aunties must bite the bullet and forget it and walk away. Hongkong and Singapore are two different cities. Hongkong is part of China ie Special Administrative Region whereas Singapore is an independent and sovereign nation. Regards, Andrew Chuah
I must applaud TKL for his effort to help unfortunate investors, and I agree that investors must try all channels.
This is not just for this instance to recover all or part of the toxic investments, but a really important effort to ensure that our children and grandchildren etc will be spared the agony we now face with our savings.
If not for anything else, many of us are now much better informed about the financial world we live in. It would perhaps take MAS’ Moneysense decades to educate us to the same level.
Even after this incident has blown over, I hope all the groups would continue to function as a kind of customer-watchdog committee to keep an eye on all the FIs. We cannot just rely on MAS and CASE alone.
Tan Kin Lian is giving these 10,000 investors majority uncles and aunties false hope to get their money back – Andrew Chuah (#9)
If you are uncomfortable with what´s going on, why don´t you take TKL face to face at Speaker´s corner? But to attack someone´s character is beyond contempt.
The Banks who sold them the Lehman bonds only earn a fees maximum 5% and it is unfair to ask these Banks to pay back the full amount.
This is not an issue of whether Singapore is a welfare state, but whether the banks have mis-sold the financial products. Even if the banks were not responsible for issuing the financial products, they were directly responsible for selling the financial product to the retail investors. Justice is always relevant, whether Singapore is a welfare state or not.
Seriously? If you go to a shop and buy a nice shirt, say because you think it’s going to get that someone to notice you, but 2 months down the road, mice infest your house and start chewing on your clothes, do you sue the shop that sold you the shirt?
How are these investors unfortunate? Financial products have inherent risks, everyone knows that. You can blame the banks all you want, but if you do not go in reading the fine print, I don’t see why tax payers should be made to pay for your stupidity.
This idea of mis-selling is complete bollocks. Banks who sell financial products like this advertise them as low-risk because that’s what they are in a decently stable economy. No one could forsee any of the problems that the global economy faces now. If the SingDollar goes bust the next day, would anyone sue banks or MAS? Seriously people, the logic here is as flawed as the logic that these ill informed investors used when buying the securities in the first place.
All that has been going down over the past couple of weeks shows us that apathy is a bane in our lives and instead of whining about it and hoping that the government fixes everything for us like little babies, maybe we could all grow up and realise that we have a need to open our eyes and be more involved in our lives and the world instead of blindly following what other people tell us.
The fact that all this hoopla is acceptable is just testament to how dumb we Singaporeans truly are.
Both Andrew Chuah and Dudboi have missed the crux of this issue altogether. This is a case of mis-selling and misrepresentation and not about risk of investment or the products themselves. There is nothing wrong with them. It is about the wrong people being sold these products and mis-selling and misrepresentation being used to hoodwink them into buying these products. This is cheating. The banks have to pay fully for ‘stealing ‘ the money of these investors through dubious means.
The banks should not be protected and cannot do anything they like and get away with it . They must be punished heavily. If they think the best way out is legal suit then they have to take reputational risk.The markets are NOt created for them to bully and fleece the consumers. The markets are created for consumers. Without consumers there is no market.
The fact that all this hoopla is acceptable is just testament to how dumb we Singaporeans truly are. – Dudboi (#12)
Do I sense social darwinism here?
This idea of mis-selling is complete bollocks. Banks who sell financial products like this advertise them as low-risk because that’s what they are in a decently stable economy. – Dudboi (#12)
Downplaying risk is mis-representation, so you agree that banks downplay risk in their advertisement.
No one could forsee any of the problems that the global economy faces now. If the SingDollar goes bust the next day, would anyone sue banks or MAS? Seriously people, the logic here is as flawed as the logic that these ill informed investors used when buying the securities in the first place. – Dudboi (#12)
Let me give you an example from the South American Financial Crisis. When the Argentinian currency collapse, an Enron subsidiary raised the water fees by 5X so that the revenue from the water sales can still be used to sustain repayment to the World Bankś project finance facility.
The Argentinian government responded by suspending the license of the Enron subsidiary to supply water to the masses, while the Enron subsidiary to the Argentinian government to the World Bank Investment Court where the Argentinian government was ordered to compensate the Enron subsidiary.
All that has been going down over the past couple of weeks shows us that apathy is a bane in our lives and instead of whining about it and hoping that the government fixes everything for us like little babies, maybe we could all grow up and realise that we have a need to open our eyes and be more involved in our lives and the world instead of blindly following what other people tell us. – Dudboi (#12)
What has happened so far is people coming together, coming out with collaborative solution to pressure banks to do the right thing and also demanding the government to fix the regulatory environment to prevent a similar occurrence in the future. From what you are saying, you think think the current regulatory framework is sufficient.
12) Dudboi on November 2nd, 2008 11.31 am
On surface, you sound correct. On closer scrutiny, its clear you have made a sweeping statement.
1. “Seriously? if you go to a shop and buy a nice shirt, say because you think it’s going to get that someone to notice you, but 2 months down the road, mice infest your house and start chewing on your clothes, do you sue the shop that sold you the shirt? ”
>>> You analogy is not a fair way to describe the current fiasco. Please be enlightened that there is such a thing as ‘mis-selling’. I can even quote you real international cases where mis selling FIs were charged and penalised. Your weak analogy is applicable only to situations where there is no mis-selling and everything is proper. Please note that in this world, there are things done correctly and some things not done correctly. You must learn this for your personal salvation.
2. “The fact that all this hoopla is acceptable is just testament to how dumb we Singaporeans truly are.”
>>>> Do you dare to turn up at HLP and say what you just said or choose to hide type it away at your desk whatever you feel like saying? I wonder what industry you work in.
Sweeping statements are the easiest that anyone can make.
Sandra Bollock
Try this link for the report Minibond holders offered alternative to lawsuit
http://www.pressdisplay.com/pressdisplay/showlink.aspx?bookmarkid=1LO7SBAT4M4&linkid=5289d5a5-602c-4f2c-95d1-68bea51ced70&pdaffid=8HM4kDzWViwfc7AqkYlqIQ%3d%3d
The below article is reposted from TKL blog here for the purpose of showing what TRUE regulator must do to protect the interest of unwary consumers from MIS-SELLING AND MISREPRESENTATION. It is incumbent upon MAS to demonstrate stringent regulation to deter any would be flouting FIs and intermediaries like RMs and insurance agents that a heavy penalty awaits them if they should breach the laws that are meant to ensure fair dealing and fair play and to protect the unwary , old folks and uneducated and educated but clueless consumers. I am sure we have not heard of any thing like the below before. Is it that our FIs and the intermediaries are well behaved?
Absolutely not true!!!! Ask the people in the same business you will hear of lurid tales of mis-selling, cheating, unscrupulous dealings especailly of insurance agents who are aiming the mdrt or tot awards. If this is true how come no enforcement of the laws? Even in this current fiasco MAS is not specific about which law is broken. We have not heard MAS saying that the RMs have broken the section 27 of the FAA . Is MAS sleeping? Is MAS protecting the FIs? Is MAS unwilling to be seen over regulating? or too much works? or 7 years of cumulative problem to be dealt with now.( the CEDLI guidelines were implemented in 2001 along with many notices and edicts to the insurance companies and FIs) Today we are no different from 2001.
.
Note the compensation amount and not S$80 millions as one local bank was crowing that it set aside.
Our FAA copied some of regulations from FSA.
Financial Services Authority fines Lloyds Bank in 2002
From Business Times
Lloyds TSB was fined GBP 1 million (S$2.35 million) in 2002 by the Financial Services Authority (FSA) of the UK and had to set aside GBP 165 million to compensate claims relating to mis-sold endowment policies, involving 45,000 policyholders.
In 2003, Lloyds TSB was further fined GBP 1.9 million and had to compensate GBP 98 million to 22,500 investors, many of them pensioners. This was related to the mis-selling of high-income ‘precipice’ bonds touted as an ‘Extra Income and Growth Plan’. These bonds promised a return of 9.75-10.25 per cent over three years (twice the bank deposit rates then) and were linked to 30 stocks. They were called ‘precipice’ bonds because the investors’ capital returns could ‘fall off a cliff’ if the markets fell below a pre-set trigger point.
The markets linked to the 30 stocks did indeed fall. These high-risk bonds, which were highly leveraged, were sold to inexperienced investors. Some 16,500 investors had never purchased equity-related investment products before.
22,500 sales out of 51,000 (that is, 44 per cent) of the total sold were deemed to have been mis-sold. Howard Davies, outgoing chairman of FSA, said that the products sold by Lloyds were ‘inherently wicked’ (because they were highly leveraged) and they were sold to unsuitable people.
Andrew Proctor, FSA director of enforcement, said: ‘There was nothing wrong with the products themselves but too much was sold to the wrong people.
Good one Zhummmeng!
A Perfectly Designed System can still be easily broken by the people tasked to uphold its integrity. like this say correct or not?
Mr B.i.a.n (banana is also nice)
Donaldson Tan, I standby what I have written and I am not making a personal attack on Tan Kin Lian who may have a hidden agenda and objective perhaps making his first step into Singapore politics inview of General Election which is not far away.
These Banks and their officesrs who had sold the Lehman bonds to the 100,000 investors, had done their job professionally and explained thoroughly and it is these 100,000 investors who themselves had made bad decisions and allowed GREED to take control of their decision and judgement. Please don’t tell me that 100,000 investors majority who are Uncles and Aunties are uneducated and had been misled and misrepresented by these Banks and their officers.RISKS are everywhere and in our daily lives we have to take and face RISKS and we must be solely responsible for taking these RISKS ourselves and not come running back to the state for help after lost all our monies. Singapore is not a welfare state where these 100,000 investors are now hoping for some form of compensation,(full refund is impossible)
I wish these 100,000 investors majority who are Uncles and Aunties well in seeking Tan Kin Lian’s help.
Regards
Andrew Chuah
Reply to Andrew Chuah (#9)
You indulge in personal attack without any justification. If you bother to read my blog or view my speeches at Speaker’s Corner (www.youtube.com), you will find that there is no grounds for your accusation and attack.
Many investors came to tell me, “Mr. Tan, even if we do not get back any cent, I want to thank you for what you are doing for us”. Is this false hope? They are realistic.
There are a few people that continues to attack me in this manner. They go by the name of Singasoft, Singalong and now Andrew Chuah. Are you the same person or different people?
I do not expect any cent to be paid by MAS or the taxpayers. I call for the financial institution to share the loss equally with the investors. It is not fair for the investors to bear the loss alone.
Many investors do not agree with me. They want more than 50% compensation. I respect their views, as it is their money. I continue to encourage them to accept an amicable settlement on on a equally sharing of loss.
Andrew Chuah (#19)
If you stand by your remarks, can you identify your real identity and tell me how I can contact you? I consider your remarks to be defamatory.
The issue of my political motive has been covered in an interview with Zaobao and Today paper. They have been posted in my blog.
Thank you Mr Tan.
Although i’m not an investor, i respect you for your courage.
You show us that it’s possible to uphold the integrity of banks.
Imagine if someone like you have not came out to help, then the loaded banks will continue their malpractice of cheating the people.
Their deeds won’t be exposed as investors suffer in silence.
Many have gain insights on this crisis and i’ll not trust banks anymore.
Anyway Andrew Chuah, who would want to gain publicity in this incident?
Don’t you know this is Singapore?
The cons of being involved in politics far outweigh the pros if you are not a yes-man. Do not defame others when you are not clear of the situation.
“November 2nd, 2008 2.22 pm
“……Tan Kin Lian who may have a hidden agenda and objective perhaps making his first step into Singapore politics inview of General Election which is not far away.”
This is a very uncalled for statement! How did you draw the conclusion concerning the hidden agenda part AC? Can you please supply us the evidence to support your statement?
I really cannot understand for the life of me how you managed that incredible leap of logic.
The way I see it, it’s a very simple matter of demand and supply. Mr Tan has something worthwhile to offer and these aggrieved investors gravitate towards what he hold out.
If you dont want people to come in and step in to do the job of MAS or some other govt appointed body, then you really should not behave like a man whose wife has run off with another man bc you have not been servicing her? You need to ask yourself; why did the authorities even the create ideal conditions to fester which generate the demand for the supply to be filled by the likes of Mr Tan?
Had they move decisively and fast to take a leadership role in all this, then Mr Tan’s role would be obselete, then neither I , him or any by stander will have anything to say and what you say may well be very true, but in this case when Mr Tan came into the picture (pls correct) there was NO OFFICIAL RESPONSE. You can sue me, if you want. I have the dates to prove it and even the comparatives and I will bring the whole brotherhood press to come down on you like a ton of bricks! FACT: NOTHING WAS DONE / NO RESPONSE / NO DIRECTION / NO LEADERSHIP.
I pay my taxes so I believe, I have a right to say the lack of response beggars the imagination.
Even then, as I said earlier. I cannot for the life of me see where the hidden agenda part comes in or what it even has to do with the coming general election?
Please come back to me on this point.
I think this statement is uncalled for and you owe mr tan an apology
SD
(Internet Liaison officer of the brotherhood)
Tan Kin Lian,
I think it is better ignore the people who doubt your effort and try to destroy your reputation. There are always some clowns who can’t think, and can only talk childish like our PM who think they know better without finding out what really happen in the ground. There are always clowns in blogosphere who try to provoke for sake of provoking just to seek attention and thrill. No point wasting time on these people. The more you engage them, the more remarks they will throw.
To 9) Andrew Chuah on November 2nd, 2008 2.22 pm
“These Banks and their officesrs who had sold the Lehman bonds to the 100,000 investors, had done their job professionally and explained thoroughly………”
How do you come to this view? What facts do you have to support this view? The fact is many old individuals in Hong Kong, Singapore and Taiwan were mis-sold these type of structured products, yes they were mis-sold in Taiwan as well:
http://news.chinatimes.com/2007Cti/2007Cti-News/2007Cti-News-Content/0,4521,110514+112008110200044,00.html
.There are people talking about the responsibility of these people to check the details before buying the products.
This is an argument of trust vs responsibility
Yes, people need to exercise their responsibility to check everything to protect themselves when they can’t trust the government, the banks etc to do the right things. When people want to shift the blame to these people in the name of responsibility, they are flushing the public trust down the drain.
If MAS is not taking the banks to the task, allowing them to continue to erode the public trust, then the whole society will pay a very big price.
Remember the case of Slim10?
Wow what a fiery and yet interesting blog. I can see much fireball going in here and it does not benefit anyone in the process.
I thnik TKL came in at the right time when the investors needed someone to lead and gather them together. Of course, the five hundred people that grouped together for the fourth time at HLP is only less than 5% of the total investors that is 10,000 strong. What happened to the rest I wondered. I guess some will seek legal advice especially for those who are educated whereas others only sit and pray at home.
Singaporeans have being all along individualistic and even fragmented. We are followers and has a herd mentality. When someone stood up and says “Come follow me”. they will if the person is creditable and has a good heart. As people lost alot of money here, it is natural that they will follow any lead that has any slim chance of a compensation. It is good that TKL did not promise the investors anything as it will jeopardise any good work that he has done so far. He is merely grouping them together and ask them to sign a petition in the hope that pressure is exerted on the banks to act fairly and logically. Speaking as one person or one thousand definitely has an impact on how banks will act. My guess is that they will not compensate everyone totally but only the vulnerable. Those who are educated (even up to secondary level) may get very little back.
Consumer rights in Singapore have all along being very bias against the consumers. CASE/SIAS so far has not done its job well and in this instance has not taken leadership as it should.
In this global financial crisis, minibond investors are not the only ones who have lost money, People who invested in property, shares, unit trusts, cars, forex all lost money. The have no recourse to go to for any form of compensation.
RMs and banks have being selling their products their way all along without any problem. Of course, this will have to change as we know that certain products are not meant for certain vulnerable sector of the population. There will definitely be a revamping on how RMs sell their products and their approach on vulnearable customers. I foresee that unit trusts sales will take a dive and consumer trust will be at an all time low after. It will take a long time for people to part wit their money again.
Donaldson Tan, I standby what I have written and I am not making a personal attack on Tan Kin Lian who may have a hidden agenda and objective perhaps making his first step into Singapore politics inview of General Election which is not far away – Andrew Chuah (#19)
Are you suggesting that politicians should not be sympathetic to social causes? Moreover, General Election takes place every 5 years. It is always around the corner. Mr Tan Kin Lian so far only shown that he is sympathetic to social causes and he has been crowned as the Champions of the Underdog. It does not necessary imply he has intentions now or prior to this saga to enter politics. Just like what singaporedaddy has said, to claim Mr Tan Kin Lian has hidden agenda is a leap of faith from your own logic.
These Banks and their officesrs who had sold the Lehman bonds to the 100,000 investors, had done their job professionally and explained thoroughly and it is these 100,000 investors who themselves had made bad decisions and allowed GREED to take control of their decision and judgement – Andrew Chuah (#19)
Nobody claimed all bank officers were responsible for mis-selling. Nobody claimed all retail investors were mis-led too. However, if there is a systematic fault in the setup of how investment products were mis-sold, there is an organisational failure in the banks that resulted in this fiasco. Moreover, why would bank officers be less susceptible than retail investors to greed?
Andrew Chuah- you purposely avoid the main issue. Even your statistic is wrong.
MAS said that there are about 10,000 affected investors Not 100,000 !!!
For the benefit of those not affected, the main issue is how come so many investors from different walks of life were trapped.
The answer is ambiguous financial terms translated wrongly (intentionally or unintentionally) to trusting customers The Financial Terms all arguing about:
Credit Entitties- Citygroup Inc, DBS, Goldman Sachs, HSBC,Merill Lynch,
Standard Chartered
Redemption Upon a Credit Event – …. amount could be less or significantly
less than the principal amount invested
Since most customers don’t understand what the above statement meant, they have to ask the bank representatives.
This is what most of them were told. Their deposits are placed into the 6 reference banks. The potential loss from the bankruptcy of each bank is 1 over 6 of their deposits.
The chance of any of these AA rated banks going bust is very remote, let alone all at the same time. Ignorance or intentional misinterpretation by the banks or their representatives?
THIS IS THE REAL MEANING OF THE ABOVE STATEMENT !
“You place your money with us for 5 years. We give you 5% interest annually.
But if there is a credit event, you lost all or almost all your money.”
How many people will buy the Minibond if they were honestly told the real meaning in a simple way?
In short, many investors were sold a very high risk product masqueraded as a safe product and with a low return.
Andrew Chuah still wants to insist?
“These Banks and their officers who had sold the Lehman bonds to the 100,000 investors, had done their job professionally and explained thoroughly and it is these 100,000 investors who themselves had made bad decisions and allowed GREED to take control of their decision…..”
Then, be honourable enough to beg your boss not to give you any bonuses or annual pay increment. If you are having your own business, make sure your net profit does not exceed 2%.
The FI have the indemnities forms signed by their loyal customers.
Whether the FI want to trade them for their integrity and reputation remains to be seen.
Dear Andrew Chuah,
Please refrain from making allegations – unless you identify yourself.
Else, you will be put on moderation.
Thank you.
Regards,
Andrew Loh
@ 9) andrew chua plus @ 12) Dudboi
The focus is not whether Tan K L is giving false hope to the uncles and aunties,
but this govt has given A FALSE SENSE OF SECURITY to its citizens.
Has MAS been effective in doing its job ?
Has DBS a brand name been operating in the interest of its customers ?
82 PAP plus 2 OPP MPs have not spoken up and we have 2 characters here giving moronic comments that is not helpful to the public.
HLP is a good venue for those with conviction. The 2 of you should address the public at HLP and redeem yourselves.
Ok, so assuming I’m dumb myself and have no idea what mis-selling is, can someone explain it to me?
I think it’s unfair to think that banks are working FOR the consumers. Banks, are (to a certain degree at least) profit-motivated.
Yes, my examples are generalisations and sweeping, but consider this continuation of my analogy. If you go to a shop, do you think the salesperson will tell you if a shirt is not flattering on you? If they don’t, does that classify as mis-selling too?
Fundamentally speaking, banks are just out to earn money as well (why else would they be doing any lending), everyone’s fair game. It’s the onus of the consumer to do sufficient research as to whether a particular product is suitable for him/her or not. If the seller does any of such consultancy for you, it’s really an added bonus. I’ve done my fair share of mis-buying if you will. I regret, I learn, I move on, I do better next time.
Do I think the current framework is sufficient? I’m not fully aware of this framework to make an informed decision. Do I think banks should refund the money? No. It’s a bad investment. People make those every single day. That’s what life is, you suck it up and move on.
I don’t think it’s a bad thing that people are coming together. But if money wasn’t the issue here, most people wouldn’t care. It’s because all we care about our money so much, that we’re willing to do this. If I were to ask if people wanted to gather at hong lim park to fight for say freedom of speech, would you do it?
My question to you all is this: Say the banks do refund the money. What will come of this? Would people be more aware in future of buying securities? Maybe. For a while. Would there be a concerted effort to educate people on things like this? Probably not. What will happen is the banks will be forced to abide by stricter rules, which is really just more government intervention in this supposedly consumer-based market.
On that note, to sandra bollocks, yes, I would go to hong lim park and say it to them. But apart from the fact that it won’t work, I believe I’m legally not allowed to (yet anyway). And the best part is, even if I did, what are the chances people will just shrug me off as another CSJ?
Dear all,
With regards to the current “mis-selling” of financial products, I can’t believe the amount of public responses and views that this incident has generated. Being new to this website and all, your balanced views have given me a lot of insights about the issue of mis-selling, the current circumstances as well as important points on the seeking redress” process.
In that regard, could I then seek your assistance in giving your views, or opinion, on another similar issue. This issue involves a retirement scheme which was introduced in 1997 by a financial institution to help “asset rich but cash poor” retirees . It was claimed to provide a monthly cash payout to the retiree.
This financial Institution had stated that a retiree would get a monthly payout based on his expected life expectancy. This monthly payout would be determined by the retiree’s life expectancy and the value of his property. Based on their illustration, the retiree could expect to draw a monthly payout of $2,000 on a property worth $500,000 over 24 years.
The financial insitution had also indicated that because property cycles were cyclical, they would carry out reviews every 3 years.
However for this case which I know of, this particular retiree had only been in the scheme for 7 years when the retiree was informed by the Institution that the loaned amount had reached the 80% margin in 2004. By 2006, the institution had demanded monies from this retiree. As the retiree had no monies to pursue this in court nor could prove the Company’s initial claim, the retiree had to sell the property at the offered market price but because the auction price was below the loaned amount, this retiree now owed this institution monies. As a supposed goodwill, the institution restructered the shortfall into a loan that now has to be paid by the retiree over over an installment on the retiree’s expected life expectancy.
From the above, could anyone in the community have any knowledge on the scheme which I mentioned and if you are familiar with it, could you shed some light on its mechanics and intent of the scheme please?
Thanks! : )
Please think of many many others who live day to day. Those who have extra to indugle in these type of activities, consider yourself lucky. I often heard of someone who is able to make a pile in a flick of time what I have to slog for weeks.
19) Andrew Chuah on November 2nd, 2008 2.22 pm
You said:
………..Please don’t tell me that 100,000 investors majority who are Uncles and Aunties are uneducated and had been misled and misrepresented by these Banks and their officers.RISKS are everywhere and in our daily lives we have to take and face RISKS and we must be solely responsible for taking these RISKS ourselves and not come running back to the state for help after lost all our monies. Singapore is not a welfare state where these 100,000 investors are now hoping for some form of compensation,(full refund is impossible)
……….
>>> Like Dudboi, its sad to see you also making a sweeping statement .
The fact that Risks exist in everything does not mean its ok to mis-sell.
As long as it can be proven that there is mis-selling, its my view that the FI should take some form of RESPONSIBILITY. Someone has to also be ACCOUNTABLE. These are 2 words have different meanings.
I also can give a sweeping statement:
1. Taking a plane has risks. If the plane crashed, does it mean the airlines has no responsibility and accountability, if there was some wrong doing on the part of the airlines?
Readers, beware of sweeping statement bombasticos.
Read their comments at your own RISK.
DUDBOI,
Likely you never invested hundred of thousands and lost it all to feel the pain and anguish. Worse you have not experienced loss of all that you have and don’t have any more life to earn it back . If you were in similar situation as these folks you won’t be talking through your butt as you have been doing and ‘char seow’ with your inappropriate analogies. What you say only reveals your lack of or dud investment knowledge and stupidity..If the banks are found to have broken the laws they have to pay back every one in full. The aftermath is the consumers have more confidence of the protection of the laws and know the the salespeople and the FIs cannot cheat them anyhow but there will be fools who think they are smart and can invest on caveat emptor basis, like you who is able to read the prospectus and make informed decision. The rest, including the CPAs, MBAs and professors of NUS, still need the help of the RMs, the advisers who themselves must be investment experts and who will spare the consumers of the need to know about investment knowledge, and in this case more than CFA knowledge.The laws will ensure the products are not scam and the advisers or RMs follow prescribed steps to ensure best advice.
It is sad indeed that there are so many aggrieved investors. I have a lucky friend who asked that most important question to the bank officer: “Is the bond paying so high returns considered a high risk investment?” The answer was: “YES”. This is true and that retired police officer decided not to go ahead with the investment.
In a way, I am also fortunate. I don’t have the money to invest.
Then it is sad that there are those who hold opposing views hiding behind some secret identity and making wild allegations against someone who is trying to help some aggrieved people finding resolution. Only cowards do that.
In a balanced manner, we ought not to discount that there could be some mis-selling. Not by ALL officers, but surely there could be some. So let the FIs do the due investigations and compensate the people accordingly. If this issue is taken to the courts, there is surely only one winner, the lawyer.
See, Weaksforit’s friend did the research/asked the right questions and is safe because of it.
So, zhummmeng, your point is what again?
I have never claimed to have much investment knowledge, but I think the irony lies in the idea that you think all these people have. Because you know, at the end of the day, I’m not the one who’s lost my money.
Plus, am I not wrong to say that the idea of eggs in one basket is the first rule of investment?
I don’t deny that mis-selling, based on the commonly understood definition, probably existed in some form or other, and it probably does everywhere to a certain degree. Finding out exactly who did, now that’s going to be very very difficult. And you know what, as long as the people don’t expect the government to do something about it, I’m fine. Last I checked, the government didn’t bail my family out when WE needed the money, so yeah.
Dudboi,
nobody is bailing anyone out. The investors want their money back from the banks who cheated them. Mis-selling is cheating…..Now , let us get it right. If prospectus is enough to help you make INFORMED DECISION there is no need for an adviser or RM, right? Because it is not a a simple product an adviser is needed. Adviser advises and NOT providing you more information. Adviser will tell you ,”Uncle or auntie, this product is suitable for you after checking your financial circumstances , needs and risk appetite.”. The auncle or auntie will reply , “i trust your expertise and your words for it. How much to put? ” This is most critical moment as asset allocation is to be considered on the overall portfolio risk of the cleint.. The RM or the adviser will have to analyse again before answering the uncle or auntie’ s question, ‘How much to put?” All this cannot be done in 30 minutes but RMs can do in 10 miniutes. No mis-seling ‘see k aei’ .. This is what MAS said, “follow the steps as prescribed in the law.” but RMs didn’t. RMs said to the uncles and aunties, “put all your eggs in this basket, called minibomb ,sure make money.”
MAS is the regulator. MAS is the referee of this game. It has to make a ruling.
It is not bailing out anybody. It has to say, “banks you have broken the law and you have to pay everyone in full and no less” or the other way round “sorry ,investors the banks also lost money., so no money”
“MAS is the regulator. MAS is the referee of this game. It has to make a ruling.”
This reference allows the players to play in the soccer game but he will not oversee the game but going kopitiam for a nice long soothing cup of coffee until game over. The reference assumes the players will play by the rule, and if the any player fault, it is up to player to resolve, and it is none of the reference’s fault because the reference is in kopitiam and does not know what happen. Now the player punches the audience, but the reference is not there and therefore no red card is issued to the player. Players play violently, damaging the arms and legs of opposing side but no yellow card and warning issued because reference is not there. Coaches complain, audiences complain that reference doesn’t perform his job but reference says it is not his job to “APPROVE/DISAPPROVE” WHAT THE PLAYER DOES DURING THE GAME BUT TO “REGISTER” THE PLAYER FOR THE SOCCER GAME. Besides, reference claim he is not guilty because reference does not know what happen since he is not in the ground to witness the event. Moreover, reference says if he is too strict with the players, the player cannot produce a good soccer match therefore a “HAND-OFF” approach is the best way to encourage exciting game play and boost ticket sales.
What is the exact role of reference ? Only god knows.
MAS just like MAS SELAMAT escape scott free.
Maybe Andrew is a bank officer whose business is affected by this saga.
Ok, so assuming I’m dumb myself and have no idea what mis-selling is, can someone explain it to me? – Dudboi (#31)
Misrepresentation occurs when statement of fact made by one party to another party, which has the effect of inducing that party into the contract. Misrepresentation is still applicable even if the misrepresentation has become a term of the contract or that the contract has been performed.
Yes, my examples are generalisations and sweeping, but consider this continuation of my analogy. If you go to a shop, do you think the salesperson will tell you if a shirt is not flattering on you? If they don’t, does that classify as mis-selling too? – Dudboi (#31)
That is the salesperson’s opinion. However, the opinion becomes a fact when the salesperson is regarded as an expert. In the case of financial products, the RM is regarded as a Financial Advisor / expert who derrives his license to act as a Financial Advisor either through individual licensing or representation as a company which is legally recognised as a financial advisor.
I think it’s unfair to think that banks are working FOR the consumers. Banks, are (to a certain degree at least) profit-motivated. – Dudboi (#31)
The RM is expected to perform fiduciary duty with the retail investors, yet the prospectus denies the RM’s responsibility and goes on to claim that it is the onus of the retail investor to carry out his own independent research. Obviously something is wrong here when fiduciary duty is expected and guaranteed by the law, yet there is denial of responsibility in the prospectus.
Say the banks do refund the money. What will come of this? Would people be more aware in future of buying securities? Maybe. For a while. Would there be a concerted effort to educate people on things like this? Probably not. What will happen is the banks will be forced to abide by stricter rules, which is really just more government intervention in this supposedly consumer-based market. – Dudboi (#31)
It is widely regarded that one of the main factors causing the global financial crisis is untested financial innovation that was encouraged by financial de-regulation. Regulators have to keep up with financial innovation because sales of financial products is inherently a slippery slope. It should never be a case of how de-regulation leads to a flourishing market, but how much regulation is needed to ensure the market is healthy for both businesses and retail consumers. Regulators should play an even more pro-active role if the market suffers from information asymmetry at the consumers’ disadvantage. In a healthy market, the consumer should be just sophisticated as the businesses involved.
It’s because all we care about our money so much, that we’re willing to do this. If I were to ask if people wanted to gather at hong lim park to fight for say freedom of speech, would you do it? – Dudboi (#31)
The MAS-Lehman-DBS Saga has shown the importance of the freedom of association and freedom of speech. The intrinsic value of these freedoms is hard to judge, until one falls into a situation that requires the use of them. In this case, it is the loss of life savings that highlighted the importance of freedom of association and freedom of speech. We already have the freedom of speech and freedom of association in Singapore, but we are stifled by the climate of fear. Widespread political apathy further compounds the problem and adds up to the perception that we have no freedoms. These freedoms are already guaranteed by our constitution.
On that note, to sandra bollocks, yes, I would go to hong lim park and say it to them. But apart from the fact that it won’t work, I believe I’m legally not allowed to (yet anyway). And the best part is, even if I did, what are the chance people will just shrug me off as another CSJ? – Dudboi (#31)
Don’t insult CSJ. Whatever he is doing, it is definitely not for economic gain, unlike the case of PAP ministers who need million dollar salary to stay clear from corruption. If you claim you are better than CSJ, can you put yourself above the need for personal economic gains?
Banks and RMs all along have being doing ok until this minibond saga. WHen people are making money, nobody complained but when things go awry all hell breaks loose.
There is some truth to how RMs sell their products unethically. Having work as a RM and insurance advisor before, I have always been sceptical of the whole selling process but most RMs won’t flippantly go all the way to cheat or con investors out of their hard earned money. When you have the dollar sign of commission tied to every product that you sell, there is always this grey area of misrepresentation and mis selling. For example, I managed to persuade an uncle of mine to part away 30K of his CPF money in a unit trust eight years ago. I put on my selling charm and it took me three sessions of two hours each to successfully convince him to invest. The fund dived and I could not see him in the eye during CNY festivals for gathering. However, few years later, he told me that when the fund rose, he sold them off and managed to make a tidy profit of 8K – not bad for a 30k initial investment.
However, after this incident, I have stopped pushing people to buy unit trusts as I dont like to see my friends and relatives losing people from such investment. If they make money, they will go quietly but if they lost, they will scowled and even screamed at you.
Of course, minibond investors faced a sadder discourse – they will get lttle or nothing back from their investment. If i am one of the investors, i will also jumped and tried to get back something. Such a situation only happened once in a lifetime and those who invested in minibond must have cursed themselves on their bad luck.
If MAS found banks have mis selling irregularity with systemic failure, I am sure that they will put things right. Let MAS and the banks sort it out and investors make have to take some responsibility for their decision regardless of any issue. People have lost their money in weirder circumstances all because of the greed factor. If banks decided to compensate the vulnerable so be it – they are very fortunate. Those who did not receive any compensation, my take is that we all learn an expensive lesson here. Having look at the reports from the papers, I find that most investors have little legal chance for recourse as the banks covered all the loop holes unless they can prove that RMs have failed to discharge their duties professionally.
If there is a systematic fault in the setup of how investment products were mis-sold, there is an organisational failure in the banks that resulted in this fiasco. Such organisational failure would justify a blanket compensation policy. If MAS does not intend to investigate for systematic failure, it should not impede or discourage retail investors who want to take the financial institutions to court.
Hi Gilbert Goh (#46)
It is nice to hear about your real life experience on the sale of unit trust and the happy outcome for your uncle.
I recommend investors to buy unit trusts as follows:
> select low cost unit trust with less than 2% in upfront charges and 1% in annual fees
> select a diversified fund of blue chips
> invest for the long term, to ride out the good and bad years.
An indexed fund, such as the STI ETF, meet the above criteria. More similar good value products will appear in the future.
They should avoid the structured and similar products that are designed to have high charges (for commission and profit) that need high risks to pay off the charges.
My advice is contained in http://www.tankinlian.com/faq
Please send an e-mail to kinlian@gmail.com. I like to discuss with you separately.
To Andrew Chuah and others
Please read my blog http://www.tankinlian.blogspot.com to read the views of many investors on how they were misled into investing in these structured products.
Some investors think that these products were created in a fraudulent manner, i.e. the creators knew the products were toxic and pushed them to the investors with a propectus that hide the real truth about the products.
Most sales representatives (aka. relationship managers) were not aware about the true nature and risk of these products when they sell them to the public. They received two hours of training featuring the “positive aspects” of these products and were given an attractive commission (relative to the time needed to sell the product).
To truly understand the product, it probably needs at least two whole days of training.
Many people hold the view that if the products were properly presented, no investor would have bought the product. No sales representative would have sold the product. This is not the due to the benefit of hindsight. It is high risk from day one, even in good times.
The financial institution that sold the product should have studied and understood the product, before allowing their sales representative to sell the product using the trusted name of their institution.
The investors do not expect the Government to bail them out. They wanted the financial institutions to compensate them for their loss, due to their negligence and the misrepresentation of their sales representatives.
Read more in:
http://www.tankinlian.blogspot.com
does it mean such things will not happen again?
loopholes covered? then how?
system improved? so no more repeat? sure?
anyone can guarantee?
i no idea.
Hi TOC,
its already possible to use a digital camera to stream ‘live’ video to websites.
I hope someone would do this for mass gatherings like that in HL park to reach out to more people like those overseas and those SHY to attent these meetings.
I am sure it is legal and but not sure what it takes to do this?
LHL demo it on nday rally leh.
Hope the volunteers could consider this media. Its good to know what impact this can have. After 1 or 2 tries, it should be clear if this works.
Thanks.
Chiu Yi Ren
does it mean such things will not happen again?
loopholes covered? then how?
system improved? so no more repeat? sure?
anyone can guarantee?
i no idea.
- hmmmm Gerry
Financial institutions will have to discover new loopholes. The more loopholes they exploit. the less they can find in future as long as the ones discovered are closed.
I like to ask everyone including Mr Tan KL.
There is a Regulatory Body right?
If so , why financial problems cannot be contained and prevented the meltdown and the lehman boo boo? If people given early warning signs earlier, would they not have sold their lehman minibonds earlier before it become worthless as in $0?
I have no idea. Do you?
47) ‘live’ broadcasting? Why not? on November 3rd, 2008 9.03 am
What about someone said something defamatory and it is broadcasting live?
If my understanding is correct, even live broadcast is buffered with say 1min delay to avoid such thing.
The main function of the video is let people who can’t attend the event to get the messages made by the speakers.
Really, people need to overcome the fear factor, come out to show their support to these people. If 2-3,000 people show up to support them, MAS definitely will feel more heat.