HK investors are sueing DBS for mispresenting the bonds to the elderly members who do not understand it. Help your elderly family members to do justice !
Tuesday September 23, 10:48 PM
Hong Kong investors may sue sellers of Lehman-backed bonds
Hong Kong investors who bought complex financial products backed by collapsed US investment bank Lehman Brothers were considering suing the institutions who sold them, a lawmaker said Tuesday.
Investors argued the banks who sold the instruments guaranteed by the failed Wall Street titan did not fully explain the high risks associated with the products.
"The investors are considering mounting legal action against the banks for misrepresentation," Albert Ho, chairman of the Democratic Party and a lawyer, told AFP.
Many of the investors, who paid a total of 12.7 billion Hong Kong dollars (1.63 billion US), had been sold mini-bonds, which are based on derivatives linked to major firms' stocks but are worthless if the guarantor goes bankrupt.
"These products used to be sold by only investment banks to clients who had at least 1 million US dollars," said Ho.
"But a few years ago, commercial banks wanted to snatch a piece of the pie and started to convince their elderly customers to buy the mini-bonds without explaining to them the risks involved," he said.
Ho said investors will meet the city's Consumer Council on Thursday to see if they can get legal and financial assistance to try and recoup their losses.
Ho said many of the bond holders were retired and had put all their savings into the investment because they trusted their banks.
Some 800 people attended a meeting held Monday night with investors, Ho said. Some of them protested on Sunday to urge the government to provide assistance.
The Securities and Futures Commission said they had received 155 complaints from investors by Tuesday noon, most of which related to alleged mis-selling by banks.
"We are pursuing the complaints vigorously. For those complaints related to alleged mis-selling by banks, we have referred them to the Hong Kong Monetary Authority for further action," a spokesman for the commission told AFP.
The Monetary Authority said it had received 54 written complaints from mini-bond holders and it had also opened a hotline for investors' enquiries.
The Consumer Council said it had received a few enquiries from the investors and would consider their application for its legal assistance fund, a spokeswoman for the council said.
Lehman Brothers collapsed last week under the strain of the US subprime, or high-risk, mortgage crisis, sparking turmoil on financial markets across the world.
Tuesday September 23, 10:48 PM
Hong Kong investors may sue sellers of Lehman-backed bonds
Hong Kong investors who bought complex financial products backed by collapsed US investment bank Lehman Brothers were considering suing the institutions who sold them, a lawmaker said Tuesday.
Investors argued the banks who sold the instruments guaranteed by the failed Wall Street titan did not fully explain the high risks associated with the products.
"The investors are considering mounting legal action against the banks for misrepresentation," Albert Ho, chairman of the Democratic Party and a lawyer, told AFP.
Many of the investors, who paid a total of 12.7 billion Hong Kong dollars (1.63 billion US), had been sold mini-bonds, which are based on derivatives linked to major firms' stocks but are worthless if the guarantor goes bankrupt.
"These products used to be sold by only investment banks to clients who had at least 1 million US dollars," said Ho.
"But a few years ago, commercial banks wanted to snatch a piece of the pie and started to convince their elderly customers to buy the mini-bonds without explaining to them the risks involved," he said.
Ho said investors will meet the city's Consumer Council on Thursday to see if they can get legal and financial assistance to try and recoup their losses.
Ho said many of the bond holders were retired and had put all their savings into the investment because they trusted their banks.
Some 800 people attended a meeting held Monday night with investors, Ho said. Some of them protested on Sunday to urge the government to provide assistance.
The Securities and Futures Commission said they had received 155 complaints from investors by Tuesday noon, most of which related to alleged mis-selling by banks.
"We are pursuing the complaints vigorously. For those complaints related to alleged mis-selling by banks, we have referred them to the Hong Kong Monetary Authority for further action," a spokesman for the commission told AFP.
The Monetary Authority said it had received 54 written complaints from mini-bond holders and it had also opened a hotline for investors' enquiries.
The Consumer Council said it had received a few enquiries from the investors and would consider their application for its legal assistance fund, a spokeswoman for the council said.
Lehman Brothers collapsed last week under the strain of the US subprime, or high-risk, mortgage crisis, sparking turmoil on financial markets across the world.
