Wednesday, September 24, 2008

Approach taken by Hong Kong Monetary Authority

Posted in www.theonlinecitizen.com

14)--> Lucky Tan on September 24th, 2008 11.22 am

It is interesting to watch how Hong Kong respond to the Lehman Minibond issue vs Singapore.
In HK, the authorities have set up direct hotlines to register complaints and lawmakers are preparing to take action against the banks. In Singapore, MAS issue a statement asking individual investors to go sort it out with the banks themselve - its like a “please don’t bother me attitude”.

Lodge your complaint with your financial institution

Some investors were worried that they missed out from signing the online petition that attracted over 500 signatures. There is no need to worry about missing this petition.

A petition is a request to the authority to take action. 500 signatures are more than enough. I am sure that MAS will be responding pro-actively to the petition.

You can still register your particulars here:
http://www.petitiononline.com/CLSINVES/petition.html

It is more important that each investor should write to lodge your complaint with the financial institution that sold the product to you. You can send a registered letter to make sure that there is a record of its despatch.

Read this blog:
http://tankinlian.blogspot.com/2008/09/lodge-complaint-with-financial.html

Some investors told me that they have difficulty in writing the complaint letter. My friend Adrian Tan has agreed to help. You can send your facts to him in by e-mail. He will try to write it for you. Adrian Tan <atans1@hotmail.com>

MAS statement on Protecting Policyholders

Hi Kin Lian,
Thanks for your prompt reply. I just found the actual MAS statement which is more assuring. Here's the link: http://www.mas.gov.sg/news_room/letters_to_editors/2008/Response_to_do_more_to_protect_policy_holders.html

Beware of ELN (Equity Link Notes)

Dear Mr. Tan,

This is the first time I visited your blog and find that they are very useful and informative. I have experience in stock market, but not in the bond market of structure product and hence fall into th plight of the recent turmoil.

I would like to post the following in your blog to draw attention from the public about the above product. It is normally ties to a single company. For example for company X which is trading at $2.00. The bank could offer you 96% ($1.92) bid price at 12%pa for a period of 4 weeks. Here is how it work, if at maturity, the stock price is at or above $1.92 you get the interest of about 1%. Should the price of the stock fall below it, you will receive the stock which will be sold to you at the bid price ($1.92) even though the price of the stock is only at $1 trading at SGX - another example of limited earning and limitless loss.

HS

Experience in lodging a complaint with the bank

Hi Mr. Tan,

I had a tele conference with two "product experts" of DBS. This conference, arranged by my RM, was to address any concerns I might have about my investment in high notes 2.

We discussed about the several issues and told them that I strongly felt that the product was mispresented to me. I also cited a clause in the pricing statement saying that "the product was not suitable for inexperienced investor" and told them that it was unethical of the bank to have sold many of this risky high notes products to gullible old uncles and aunties.

That noted my complaints and promised that the taped conversation will be passed to an "independent team" within the bank to investigate, the results of which would be forwarded to MAS.

Do you think this is what the MAS wanted the bank to do and is this sufficient? My concerns are not every investor has a RM to ask for a tele conference and how about those who cannot converse in English?

You may want to post this email in your blog (within revealing my email address) so as to encourage as many investors as possible to voice their complaints through such tele conference.

C.S.Tan

REPLY
I do not agree with the approach taken by MAS. I hope that MAS realise that it is very difficult for the public to go through this complicated process. They are likely to get an unsatisfactory outcome from the financial institution.

Unable to pay premium till 70 - Revosave

Dear Mr Tan
I attended a talk you conducted when you were still with NTUC income and you came across as honest and sincere.


I vaguely understand that Revosave is a combination of insurance, savings and investment. Expecting no one to support my needs in old age, I bought Revosave on impulse, putting in about $1,000 every month. If I understand correctly, I should be getting a "guaranteed cash benefit" after two years, but how much and whether it is worth it, I don't know.

I am past 55 and getting worried that I would not have the resources to put aside $1,000 a month till I'm 70 years old to benefit from the plan. Should I cut my losses and terminate the plan now and just put my money in a fixed deposit?

REPLY
It is improper for the insurance adviser to sell you a policy without considering your abilty to pay the premium. If you have been badly advised, you should lodge a complaint with NTUC Income. If they do not give you a suitable redress, you can complaint to FiDREC (www.fidrec.org.sg). You should not have to suffer a big loss from this bad advice.

Business Ethics

Can we get business to operate honestly and with integrity?
Can they earn the trust of consumers?
Read this paper:
http://www.tankinlian.com/articles/ethics.html