Dear Mr, Tan Kin Lian,
I have two concerns about NTUC Income's bonus restructure enforced on policy holders effective last year, 2008.
First Concern
I have been paying about 11 years for an Income endowment policy. If I am not mistaken, my payout from NTUC Income at maturity date, 2011, will probably be badly affected by the recession. Had the bonus not been restructured in 2008, I would have a larger amount locked-in last year because the economy was bouyant in 2007 and the bonus for 2007 is distributed in 2008.
Second Concern
I think policyholders like me should have been allowed an opt out option last year when Income decided to restructure the bonus. This is because when I signed for my policy it was based on a different understanding of the bonus distribution. I have only two years more to pay my premiums so if I understood how my policy is affected by the bonus restructure, I should be allowed to opt out with no penalty. I find I cannot opt out now because of the financial penalty incurred, I have to continue my premium payments for this year and the next.
In conclusion, I expect my worst fears will be realised when I receive notification of downward revision on Income endowment policy after the end of Income's financial year.
I would like to hear from you. Thank you very much, your insights into these concerns I'm sure will be absolutely helpful.
REPLY
I agree with your views. I believe that NTUC Income should have allowed policyholders to make a choice to stay with the old bonus structure.
But the management and board was adament about their right to change the bonus structure and not to give this option. The chairman made a promise at last year's Annual General Meeting about the future bonuses. At that time, the promise was quite reasonable.
Subsequently, the global financial crisis came, and made the situation worse for policyholders - especially with the restructured bonus.
I suggest that you write to the chairman of the board of NTUC Income to express your views. You can also write to MAS.
Monday, February 2, 2009
Advice on lodging complaint on FIDREC
Mr Wang Says So http://mrwangsaysso.blogspot.com/ is writing a series of articles on possible lines of arguments that investors could use when they use the FIDREC adjudication process. I urge you to read the articles.
The first two articles.
He may be writing other articles.
SCMP:Minibond settlement may start new troubles
Source
3 Feb 2009
Enoch Yiu
The city’s corporate police seem to be getting smarter and faster – at least when it comes to such high-profile cases as the minibond issue.
While in the past insider dealing cases needed seven or eight years to reach a final verdict, the Securities and Futures Commission has made history by taking only four months to reach settlement with Sun Hung Kai Investment Services on the minibond refund.
The brokerage has agreed to voluntarily pay back all HK$85 million to 310 investors in minibonds issued or guaranteed by collapsed Lehman Brothers Holdings. The landmark settlement shows the commission can move mountains when it wants to.
It also appears to be a smart choice. While the broker insisted it had done nothing wrong, it agreed to give a full refund to investors. Had the SFC opted to take the case to the Market Misconduct Tribunal, it might have waited many years for a ruling and investors might not have got their money back in the end.
Our regulatory friends have assured White Collar that Sun Hung Kai is not the only one in the SFC’s sights. It is checking other minibond distributors – understood to include two brokers and 21banks – and will demand a full refund to clients if it is confirmed they had misled investors into buying the products without explaining the risks.
Once the SFC reached an agreement with an institution, all of the firm’s clients would receive the compensation.
White Collar is concerned investors may now ignore the moral hazard of investing in such dubious products. The 310 Sun Hung Kai investors who bought the Lehman minibonds did not need to bear any investment losses at all.
The SFC considered they should be fully repaid as they would never have been lured into buying the products if brokers and banks had clearly explained the risks involved.
But Sun Hung Kai has been a broker in Hong Kong for 40 years and has many sophisticated clients. Were all these clients so naive as to be misled by the brokerage staff? If some investors bought the products with their eyes open, they should bear at least some responsibility.
Has a precedent been set where investors use high-profile complaints and street protests to pressure the SFC to force intermediaries to accept liability for the investors’ own wrong investment decisions?
The other problem created by the Sun Hung Kai settlement is the expectation gap. Other minibond investors may not accept lower compensation levels from their banks or brokerages. It will certainly add pressure to other banks and brokers to follow suit, but neither the SFC nor the Hong Kong Monetary Authority can force them to offer the same settlement.
It is easy to understand why Sun Hung Kai was willing to pay up – the money involved was not large, at less than 1per cent of all minibonds sold. Also, if it said no to the SFC, it would have risked losing its licence.
For the banks, some of which have sold several billion dollars worth of minibonds, a full settlement may be less attractive. Although the SFC can mete out disciplinary action, it is the HKMA that supervises their daily operations and issues their licences.
As this column has mentioned before, the government should seriously consider a single financial regulator for banks and brokers.
3 Feb 2009
Enoch Yiu
The city’s corporate police seem to be getting smarter and faster – at least when it comes to such high-profile cases as the minibond issue.
While in the past insider dealing cases needed seven or eight years to reach a final verdict, the Securities and Futures Commission has made history by taking only four months to reach settlement with Sun Hung Kai Investment Services on the minibond refund.
The brokerage has agreed to voluntarily pay back all HK$85 million to 310 investors in minibonds issued or guaranteed by collapsed Lehman Brothers Holdings. The landmark settlement shows the commission can move mountains when it wants to.
It also appears to be a smart choice. While the broker insisted it had done nothing wrong, it agreed to give a full refund to investors. Had the SFC opted to take the case to the Market Misconduct Tribunal, it might have waited many years for a ruling and investors might not have got their money back in the end.
Our regulatory friends have assured White Collar that Sun Hung Kai is not the only one in the SFC’s sights. It is checking other minibond distributors – understood to include two brokers and 21banks – and will demand a full refund to clients if it is confirmed they had misled investors into buying the products without explaining the risks.
Once the SFC reached an agreement with an institution, all of the firm’s clients would receive the compensation.
White Collar is concerned investors may now ignore the moral hazard of investing in such dubious products. The 310 Sun Hung Kai investors who bought the Lehman minibonds did not need to bear any investment losses at all.
The SFC considered they should be fully repaid as they would never have been lured into buying the products if brokers and banks had clearly explained the risks involved.
But Sun Hung Kai has been a broker in Hong Kong for 40 years and has many sophisticated clients. Were all these clients so naive as to be misled by the brokerage staff? If some investors bought the products with their eyes open, they should bear at least some responsibility.
Has a precedent been set where investors use high-profile complaints and street protests to pressure the SFC to force intermediaries to accept liability for the investors’ own wrong investment decisions?
The other problem created by the Sun Hung Kai settlement is the expectation gap. Other minibond investors may not accept lower compensation levels from their banks or brokerages. It will certainly add pressure to other banks and brokers to follow suit, but neither the SFC nor the Hong Kong Monetary Authority can force them to offer the same settlement.
It is easy to understand why Sun Hung Kai was willing to pay up – the money involved was not large, at less than 1per cent of all minibonds sold. Also, if it said no to the SFC, it would have risked losing its licence.
For the banks, some of which have sold several billion dollars worth of minibonds, a full settlement may be less attractive. Although the SFC can mete out disciplinary action, it is the HKMA that supervises their daily operations and issues their licences.
As this column has mentioned before, the government should seriously consider a single financial regulator for banks and brokers.
SCMP:Lawmakers want brokerage's role in Lehman products saga revealed
Source
3 Feb 2009
Paggie Leung
Legislators have urged the Securities and Futures Commission to publish in full the details of its investigation into Sun Hung Kai Investment Services’ sales of Lehman Brothers investment products.
“Why don’t you release the investigation report to let us decide whether your penalty is a fair one?” financial affairs panel legislator Albert Ho Chun-yan asked SFC chief executive Martin Wheatley yesterday at a meeting to discuss reports on the minibond saga prepared by the commission and the Hong Kong Monetary Authority.
The question came 11 days after the SFC reprimanded the company over its sales of minibonds.
The firm immediately announced it would repay about 300 investors HK$85 million and review its internal systems. It did not acknowledge any liability or wrongdoing.
“No one knows what Sun Hung Kai did … we are all in the dark,” Mr Ho said. He said he would have preferred it if the SFC had just fined the firm and used that to repay the investors. “The message would be clearer and fairer,” he said.
Civic Party legislator Ronny Tong Ka-wah said disclosure would let firms know the “things [the SFC] is going to do to the institutions to make them realise that in future, they have to adhere to regulations faithfully”.
However, the commission said it had achieved the best outcome in the case, given that it did not have the power to order the company to pay compensation.
“Getting compensation back to its investors is the most important part of this investigation process and imposing a fine would not achieve that,” Mr Wheatley told lawmakers.
“I think you have to realise that it would make any negotiation we have with any of the banks concerned more difficult if we couldn’t achieve any agreement [with Sun Hung Kai].”
Hong Kong investors lost billions of dollars on minibonds guaranteed by Lehman Brothers when the US investment bank went bankrupt in September 2008. Minibonds are not corporate bonds, but consist of highrisk credit-linked derivatives. They are marketed as a proxy investment in well-known companies.
3 Feb 2009
Paggie Leung
Legislators have urged the Securities and Futures Commission to publish in full the details of its investigation into Sun Hung Kai Investment Services’ sales of Lehman Brothers investment products.
“Why don’t you release the investigation report to let us decide whether your penalty is a fair one?” financial affairs panel legislator Albert Ho Chun-yan asked SFC chief executive Martin Wheatley yesterday at a meeting to discuss reports on the minibond saga prepared by the commission and the Hong Kong Monetary Authority.
The question came 11 days after the SFC reprimanded the company over its sales of minibonds.
The firm immediately announced it would repay about 300 investors HK$85 million and review its internal systems. It did not acknowledge any liability or wrongdoing.
“No one knows what Sun Hung Kai did … we are all in the dark,” Mr Ho said. He said he would have preferred it if the SFC had just fined the firm and used that to repay the investors. “The message would be clearer and fairer,” he said.
Civic Party legislator Ronny Tong Ka-wah said disclosure would let firms know the “things [the SFC] is going to do to the institutions to make them realise that in future, they have to adhere to regulations faithfully”.
However, the commission said it had achieved the best outcome in the case, given that it did not have the power to order the company to pay compensation.
“Getting compensation back to its investors is the most important part of this investigation process and imposing a fine would not achieve that,” Mr Wheatley told lawmakers.
“I think you have to realise that it would make any negotiation we have with any of the banks concerned more difficult if we couldn’t achieve any agreement [with Sun Hung Kai].”
Hong Kong investors lost billions of dollars on minibonds guaranteed by Lehman Brothers when the US investment bank went bankrupt in September 2008. Minibonds are not corporate bonds, but consist of highrisk credit-linked derivatives. They are marketed as a proxy investment in well-known companies.
Ten of the worst ... scams to avoid
Dear Mr Tan
Please find an updated list of top ten scams from the UK Guardian Feb 2 2009 . Land Banking is listed at number 4 and continues to be a problem. Is there any chance some action will be taken on this in Singapore
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Ten of the worst ... scams to avoid
More than 3 million consumers fall victim to scams each year, but you don't have to be one of them. Tony Levene picks the main ones to avoid
Tony Levene
Monday February 2 2009
guardian.co.uk
Scams cost UK consumers at least GBP3.5bn last year, according to the Office of Fair Trading (OFT). And the older you are, the more likely you are to lose money: older folk tend to have cash as well as being more trusting.
The OFT estimates 3 million UK consumers a year fall victim to scams sent by post, email, text or over the phone. But the real figure could be much higher. Many victims fail to report losses, often due to embarrassment.
Today is the first day of the OFT's scams awareness month designed to raise awareness of mass marketed scams. The consumer watchdog is setting up a nationwide "Scamnesty" scheme, which calls on consumers to drop scam mailings into scamnesty bins or boxes at local libraries and public areas across the country. The OFT says the information collected will help identify and develop strategies to combat the worst criminals.
So what are the scams most likely to catch people out? Here is our top 10.
Please find an updated list of top ten scams from the UK Guardian Feb 2 2009 . Land Banking is listed at number 4 and continues to be a problem. Is there any chance some action will be taken on this in Singapore
-------
Ten of the worst ... scams to avoid
More than 3 million consumers fall victim to scams each year, but you don't have to be one of them. Tony Levene picks the main ones to avoid
Tony Levene
Monday February 2 2009
guardian.co.uk
Scams cost UK consumers at least GBP3.5bn last year, according to the Office of Fair Trading (OFT). And the older you are, the more likely you are to lose money: older folk tend to have cash as well as being more trusting.
The OFT estimates 3 million UK consumers a year fall victim to scams sent by post, email, text or over the phone. But the real figure could be much higher. Many victims fail to report losses, often due to embarrassment.
Today is the first day of the OFT's scams awareness month designed to raise awareness of mass marketed scams. The consumer watchdog is setting up a nationwide "Scamnesty" scheme, which calls on consumers to drop scam mailings into scamnesty bins or boxes at local libraries and public areas across the country. The OFT says the information collected will help identify and develop strategies to combat the worst criminals.
So what are the scams most likely to catch people out? Here is our top 10.
1. Homeworking scams
Credit-crunched people turning to part-time work to help balance budgets need to watch out. Homeworking scamsters advertise "easy earnings" in return for cash. But all they send out is a leaflet telling people to advertise "easy earnings" schemes. Others promise big rewards for packing goods ? they take the money upfront and victims never see any earnings, even if they are conned into packing goods.
Credit-crunched people turning to part-time work to help balance budgets need to watch out. Homeworking scamsters advertise "easy earnings" in return for cash. But all they send out is a leaflet telling people to advertise "easy earnings" schemes. Others promise big rewards for packing goods ? they take the money upfront and victims never see any earnings, even if they are conned into packing goods.
2. Racing tipsters
Many tipsters try to find winners, but some offer "guaranteed" tips which turn into a regular income in return for a fee. Except they don't. Others ask you to put money on horses for them in return for a 50% share of winnings, while promising to recompense losing bets. The only safe bet is that you won't see your money again.
Many tipsters try to find winners, but some offer "guaranteed" tips which turn into a regular income in return for a fee. Except they don't. Others ask you to put money on horses for them in return for a 50% share of winnings, while promising to recompense losing bets. The only safe bet is that you won't see your money again.
3. Bogus foreign lotteries
You receive a letter from Spain saying you have won a million euros in a lottery you have never heard of, let alone entered. The fraudsters demand you send some money to "unlock the cash". And then some more. There is no prize ? victims can lose tens of thousands of pounds.
You receive a letter from Spain saying you have won a million euros in a lottery you have never heard of, let alone entered. The fraudsters demand you send some money to "unlock the cash". And then some more. There is no prize ? victims can lose tens of thousands of pounds.
4. Landbanking
Fraudsters buy a field, divide it into tiny slices and sell each one for big money ? usually ?10,000 ? by convincing victims the land will soon get planning permission. The land never gets planning consent and the landbankers disappear with your money, leaving you with valueless land.
Fraudsters buy a field, divide it into tiny slices and sell each one for big money ? usually ?10,000 ? by convincing victims the land will soon get planning permission. The land never gets planning consent and the landbankers disappear with your money, leaving you with valueless land.
5. Pyramid schemes
A classic pyramid scheme involves getting lots of people to invest small amounts of money and offering them a reward for every new recruit they sign up. For example, you might be invited to invest ?3,000 of your own money and asked to recruit seven other investors who will pay you ?3,000 each. You now have ?21,000. The incentive for your friends is that they are "allowed" to go out and each recruit seven other investors so they get ?21,000 as well. It is illegal and people soon run out of friends to con.
A classic pyramid scheme involves getting lots of people to invest small amounts of money and offering them a reward for every new recruit they sign up. For example, you might be invited to invest ?3,000 of your own money and asked to recruit seven other investors who will pay you ?3,000 each. You now have ?21,000. The incentive for your friends is that they are "allowed" to go out and each recruit seven other investors so they get ?21,000 as well. It is illegal and people soon run out of friends to con.
6. Business opportunity scams
Here you are offered a "franchise" or other business idea in return for thousands of pounds in fees. The attraction is along the lines of "thousands of pounds a month without leaving the comfort of your armchair." The idea is usually rubbish and the originator runs off with your money.
Here you are offered a "franchise" or other business idea in return for thousands of pounds in fees. The attraction is along the lines of "thousands of pounds a month without leaving the comfort of your armchair." The idea is usually rubbish and the originator runs off with your money.
7. Phoney jobs
Another credit crunch special. Websites promise jobs with high pay for an hour's work a day for those with no experience or skills. The first snag is you have to send substantial cash sums for the application form upfront. The second snag is that the job does not exist.
Another credit crunch special. Websites promise jobs with high pay for an hour's work a day for those with no experience or skills. The first snag is you have to send substantial cash sums for the application form upfront. The second snag is that the job does not exist.
8. Bouncing cheques
Advertise your car or motorbike in a legitimate website or publication and you could get someone offering you more than you ask for. They will back this up by sending you a "certified cheque" or "banker's draft" for the cash. By the time you discover the cheque is a forgery your vehicle is halfway across Europe. Many insurers will not pay out for "theft by deception".
Advertise your car or motorbike in a legitimate website or publication and you could get someone offering you more than you ask for. They will back this up by sending you a "certified cheque" or "banker's draft" for the cash. By the time you discover the cheque is a forgery your vehicle is halfway across Europe. Many insurers will not pay out for "theft by deception".
9. Boiler room investment frauds
Very persuasive salespeople call you up ? usually from abroad ? to offer you sure-fire share investments. The shares, if they exist at all, are overpriced by up to 100 times. And it is impossible to sell them. It is easy to lose ?20,000 or more.
Very persuasive salespeople call you up ? usually from abroad ? to offer you sure-fire share investments. The shares, if they exist at all, are overpriced by up to 100 times. And it is impossible to sell them. It is easy to lose ?20,000 or more.
10. Phishing
This is nothing to do with angling! Fraudsters send emails purporting to come from your bank's security department, asking you for your log-in, password and other personal details. Once they have these they loot your account. No legitimate bank ever asks for these details. And banks are getting tougher with victims, telling some they will not be recompensed for their losses because, by now, everyone should know about this racket.
Tony Levene is the author of How to avoid scams (Age Concern ?9.99)
Copyright Guardian Newspapers Limited 2009
This is nothing to do with angling! Fraudsters send emails purporting to come from your bank's security department, asking you for your log-in, password and other personal details. Once they have these they loot your account. No legitimate bank ever asks for these details. And banks are getting tougher with victims, telling some they will not be recompensed for their losses because, by now, everyone should know about this racket.
Tony Levene is the author of How to avoid scams (Age Concern ?9.99)
Copyright Guardian Newspapers Limited 2009
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