Don't file it in Kangaroo Sinkapor!
Couple seek to recover US$1.2m in HK
DBS Bank (HK) sued over losses from Lehman-linked products
By Selina Lum
HONG KONG: Two former Singapore residents have sued DBS Bank (Hong Kong) for selling them structured products linked to the now-collapsed United States investment bank Lehman Brothers.
The retired couple, Mr Stephen Tou Kwok Woon and his wife Wong Fung Chun, filed a writ on Monday against the bank in the High Court here.
The pair, who now live in San Francisco in the US, are seeking to recover the US$1.26 million (S$1.89 million) they had invested in DBS Constellation Notes in July 2006 and April last year. In their lawsuit, the couple have alleged misrepresentation and breach of duty of care.
According to court papers obtained by The Straits Times, the couple said they had returned to Hong Kong - after living in Singapore - with a view to retirement.
They had sold their property in Singapore and moved the proceeds - nearly all their life savings - from DBS Singapore to an account with the bank in Hong Kong. In July 2006, the couple said, they were sold Series 43 Constellation structured retail notes for US$950,000 by a relationship manager at a DBS branch.
They claimed they had initially asked about putting their money in a fixed deposit account for retirement income and told the bank employee that they had little investment experience. The relationship manager then allegedly recommended the structured notes, saying they were as safe as a fixed deposit account.
The couple said they were told that the notes were issued on the strength of eight well-known financial institutions or listed companies with high credit ratings, representing a low-risk portfolio.
They said their attention was not drawn to any potential risks. Instead, they were told that in the unlikely event one of the institutions failed, the worst that could happen would be a one-eighth reduction in the principal value. The sale was completed in 20 minutes, they said.
In April last year, the relationship manager phoned the couple, who were by then in the US, recommending Series 73 notes, which were 'of the same nature' as their previous investment. The couple said they agreed to put in US$310,000.
The couple said that in late October or early November this year, a DBS representative called them to say, without further explanation, that the notes had lost all, or nearly all, of their value. They lodged a complaint with the bank but have yet to receive a satisfactory answer.
They said they found out only in October that the notes were high-risk financial instruments. The failure of one institution could lead to a total loss.
DBS has 14 days to indicate if it wishes to defend the lawsuit, after which it has another 14 days to file its defence. When contacted yesterday, DBS declined to comment as it is an ongoing legal matter.
The couple's legal team is led by Senior Counsel Anthony Neoh, who has served as chairman of the Hong Kong Securities and Futures Commission.
Couple seek to recover US$1.2m in HK
DBS Bank (HK) sued over losses from Lehman-linked products
By Selina Lum
HONG KONG: Two former Singapore residents have sued DBS Bank (Hong Kong) for selling them structured products linked to the now-collapsed United States investment bank Lehman Brothers.
The retired couple, Mr Stephen Tou Kwok Woon and his wife Wong Fung Chun, filed a writ on Monday against the bank in the High Court here.
The pair, who now live in San Francisco in the US, are seeking to recover the US$1.26 million (S$1.89 million) they had invested in DBS Constellation Notes in July 2006 and April last year. In their lawsuit, the couple have alleged misrepresentation and breach of duty of care.
According to court papers obtained by The Straits Times, the couple said they had returned to Hong Kong - after living in Singapore - with a view to retirement.
They had sold their property in Singapore and moved the proceeds - nearly all their life savings - from DBS Singapore to an account with the bank in Hong Kong. In July 2006, the couple said, they were sold Series 43 Constellation structured retail notes for US$950,000 by a relationship manager at a DBS branch.
They claimed they had initially asked about putting their money in a fixed deposit account for retirement income and told the bank employee that they had little investment experience. The relationship manager then allegedly recommended the structured notes, saying they were as safe as a fixed deposit account.
The couple said they were told that the notes were issued on the strength of eight well-known financial institutions or listed companies with high credit ratings, representing a low-risk portfolio.
They said their attention was not drawn to any potential risks. Instead, they were told that in the unlikely event one of the institutions failed, the worst that could happen would be a one-eighth reduction in the principal value. The sale was completed in 20 minutes, they said.
In April last year, the relationship manager phoned the couple, who were by then in the US, recommending Series 73 notes, which were 'of the same nature' as their previous investment. The couple said they agreed to put in US$310,000.
The couple said that in late October or early November this year, a DBS representative called them to say, without further explanation, that the notes had lost all, or nearly all, of their value. They lodged a complaint with the bank but have yet to receive a satisfactory answer.
They said they found out only in October that the notes were high-risk financial instruments. The failure of one institution could lead to a total loss.
DBS has 14 days to indicate if it wishes to defend the lawsuit, after which it has another 14 days to file its defence. When contacted yesterday, DBS declined to comment as it is an ongoing legal matter.
The couple's legal team is led by Senior Counsel Anthony Neoh, who has served as chairman of the Hong Kong Securities and Futures Commission.
