Minibond investors hadn't heard of Lehman

And Jeffrey Lam, the Legco member whose company has business with BOC, dare to lie in Legco that the bankers had told the victims that they were buying Lehman Minibonds inside the Bank of China at those time during Legco question period and was stopped by other members of Legco.

http://minibondsoctaveconstellation.blogspot.com/2009/05/legislator-jeffrey-lam-dear-citizens-of.html

Investors in Lehman Brothers minibonds told a Legislative Council subcommittee yesterday they had never heard of the bank before its collapse in 2008 and had not realised their savings were lost when told of its failure.

The investors were testifying at the subcommittee's first hearing on the Lehman Brothers collapse and the loss of millions of dollars in savings of Hong Kong investors, many of them pensioners.

The first three to testify - Ip Chun, Ng Joong-yee and Ho Lai-yuet - all bought Lehman minibonds from the Bank of China (Hong Kong) and said they had not been given any prospectuses and were not aware of the risks when buying derivatives.

Ho, 70, said she did not immediately realise she had lost her HK$480,000 investment, half of her total savings, when Lehman Brothers collapsed in September 2008. She said she had bought the minibonds from a Bank of China staff member whom she had known for two years.

I was doing fixed deposits at the bank. The staff member told me she had a better offer for me. She said it was a three-year plan with a better interest rate, Ho said. News of Lehman Brothers' collapse did not concern her at first, as she had not realised she was exposed to any of its products.

Then the staff member called me one day and told me the three-year plan I bought was not operating anymore. I was very puzzled.

She said she had not been given any documents or receipts until she asked the bank to send these to her after Lehman Brothers collapsed.

Ng, 75, told the subcommittee that Bank of China staff who advised him to buy the minibonds had not even mentioned Lehman Brothers, and he was unaware of the consequences for him when the US bank collapsed.

I had bought MTR and government bonds in the past and I thought minibonds were just the same.

He said he was told to sign two documents when he invested HK$1.26 million: one was the contract, the other was blank. He said staff had not explained the risks.

I got back the blank document from them after Lehman Brothers collapsed. It was the risk assessment, and the information on it was totally wrong. They even mixed up the ages of my wife and I, Ng said.

When subcommittee member Chan Kin-por asked Ng why he had signed a blank document, he replied: I believed in the bank, and thought I needed to sign two documents to buy the products, so I signed.

Ip invested HK$1 million in minibonds, one-third of her total savings. She said she was only shown a leaflet and told it was a safe investment. When I asked about the risks they only told me to be confident. I trusted the staff there because they represented the bank and I thought it had a very strict policy on the promotion of products, Ip said.

Subcommittee chairman Raymond Ho Chung-tai said more investors from other banks would testify in March and April. Copyright (c) 2011. South China Morning Post Publishers Ltd. All rights reserved.