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SINGAPORE: Singapore's DBS Bank has started compensating retail investors who bought structured products linked to the collapsed Lehman Brothers.
These are cases which did not meet bank standards. But DBS refused to say how much was paid out and to how many people.
However, Channel NewsAsia understands investors will be put through interviews and evaluations before they are compensated.
Meanwhile, Hong Leong Finance and MayBank said they have contacted vulnerable investors, including the elderly and less educated.
A 63-year-old retiree, Madam Tan, said she invested S$10,000 without knowing it was related to Lehman Brothers.
She said: "I was told there would be a 5 per cent interest if I don't withdraw. So I said I understand."
She said the bank will take a month to evaluate her case before deciding on the compensation.
DBS said it will pay cash in cases where standards were not followed.
CEO of First Principal Financial, Mohd Salim, said: "First thing would be non-disclosure, the inability to disclose clearly and accurately that would classify as misrepresentation. The reps could have explained the products wrongly, in which case, they have given the investor the understanding that there's no risk at all."
That is what happened to two sisters in their forties, who invested S$160,000 through a CIMB broker friend.
One of the sisters, retail investor Tina, said: "He didn't talk about the Lehman Brothers, I never heard about it. It's only after the whole event, then I got to know how complex the whole product is.
"I no longer have the earning power that I have 20 years ago. (I am) really depending on this money, (which) I want to give to my children's education."
Tina said her sister was asked to sign up despite having an eye problem.
She said: "She couldn't see the documents, so the financial advisor actually wrote everything on her behalf and she just signed on the dot, even the cheque."
Since early October, the two sisters have lodged complaints with the relevant officials, including the Monetary Authority of Singapore. However, the only responses they have received are letters of acknowledgement.
- CNA/yt
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