SINGAPORE: The Monetary Authority of Singapore (MAS) announced on Thursday (May 17) that it has issued prohibition orders against six people for the mis-selling of investment products.
The individuals were former representatives of Prudential Assurance Company Singapore (Prudential), AIA Singapore (AIA) and Citibank Singapore, MAS said in a media release.
Their misconduct includes forgery, making false or misleading statements to clients, improper switching of policies and providing financial advice without due consideration of a client's financial situation.
A total of 29 clients were affected, including two vulnerable clients.
The prohibition orders prevent them from providing financial advisory service, as well as from taking part in the management, acting as a director or becoming a substantial shareholder of any financial advisory firm, for between two and seven years, MAS said.
One of the individuals is also prohibited from performing any regulated activity under the Securities and Futures Act, and from taking part in the management, acting as a director, or becoming a substantial shareholder of any capital market services firm, for a period of two years.
In the first of these cases, David Hiah Xinkai, who was working for Prudential at the time, was issued a seven-year prohibition order for forgery and providing false or misleading information to the insurer.
Hiah had forged the signatures of several policyholders to "effect fund switches in their investment-linked policies" without their knowledge or consent, said MAS.
"Mr Hiah did so as he was concerned that the policyholders would surrender their policies and that he would face disciplinary action by Prudential if the surrenders took place," added the authority.
In addition, he intentionally provided false or misleading information relating to his clients' personal details to Prudential when arranging insurance contracts for his clients.
This resulted in his clients losing their policy rights while Hiah earned commissions from the sale of the insurance contracts, said MAS.
Hiah's prohibition order took effect from May 14.
Meanwhile, former representative of AIA Heng Goid Hoon was issued a four-year prohibition order after advising a client to switch investment-linked policies without disclosing the switching costs to the client.
Heng also made "false declarations" on the client's policy application forms to avoid scrutiny from AIA, said MAS.
As a result, her client incurred "significant switching costs ... without any real benefit from the switch", said the authority.
"Ms Heng was also able to secure commissions from the switching by deliberately delaying the policy switch to circumvent industry prescribed rules that disallow commissions for early policy replacement," said MAS.
Heng's prohibition order took effect from Apr 30.
The misconduct committed by Hiah and Heng involved vulnerable clients, leading to stiffer action against the pair, said MAS.
4 OTHERS ALSO ISSUED PROHIBITION ORDERS
Apart from Heng, two other former representatives of AIA were also issued prohibition orders.
Koh Mei Ling and Jane Yeo Hui Rong were both issued three-year prohibition orders, both of which took effect from Apr 30.
Koh was issued a prohibition order after recommending an investment-linked policy to her client without "due consideration" of her client's financial situation, said MAS.
She also provided false information to AIA by "intentionally inflating her client's annual income" in the policy application.
"As a result, Ms Koh earned commissions from the sale of the investment-linked policy and the client purchased an investment-linked policy she could not afford," said MAS.
Meanwhile, Yeo made "false and misleading statements" to her clients about the features of their investment-linked policies, misrepresenting that their policies had guaranteed investment returns, when she knew this was not the case.
"Ms Yeo secured commissions from the sale of these policies and the clients did not earn the promised returns," said MAS.
In addition, Nigel Chua Bingquan (who was working for Prudential at the time) and Zheng Xuemei (who was working for Citibank Singapore) were both also issued prohibition orders by MAS for misconduct including making false or misleading statements to their clients, as well as making false declarations in the sales documents in order to avoid scrutiny from their respective companies.
Chua was issued a three-year prohibition order while Zheng was issued a two-year prohibition order. Both orders took effect from May 14.
AFFECTED AIA CUSTOMERS "REMEDIATED" FOR LOSSES
AIA Singapore said in response to queries from Channel NewsAsia that the customers affected by the misconduct of its three former representatives "have been remediated for any losses" they may have suffered.
"We strictly adhere to a zero-tolerance policy against any fraudulent acts by any of our representatives," it said.
"In the event that our customers’ interests are compromised as a result of misconduct by any of our representatives, AIA Singapore would ensure that appropriate actions are taken to remediate the affected customers," it added.
A Citi spokesperson also said that the bank does not tolerate such misconduct.
"The individual was dismissed in 2016. We do not tolerate any misconduct that goes against the laws of the country and/or the policies of the bank,” it said.
Mr Lee Boon Ngiap, assistant managing director for capital markets at MAS, stressed that financial institution representatives have a duty of care to their customers.
"Representatives of financial institutions who give advice on financial products have a duty of care to their customers," he said. "MAS will take stern action against representatives who betray the trust placed in them and provide false or misleading information or give irresponsible advice to their customers.”
Additional reporting by Junn Loh.