New Media, Political flims, Open Society & Fair Play

I have posted a Chinese news article from Taiwan regarding FAIR PLAY in sportsmanship recently. The article is basically reporting on the Tug-of-War event held in Taiwan. During the finals, the Swiss team was contesting against the Taiwanese team. One member of the Taiwanese team suffered an injury and by the rule, the Swiss will have the advantage of contesting against the Taiwanese team with full strength.

However the Swiss team chose to have one member less in order to match the number of members in the Taiwanese team instead of taking advantage of the situation then. In the end, the Swiss team still won, not only the game but the glory of it. The article then compared the ugly side of Taiwanese politics to the spirit of fair play displayed by the Swiss team.

This article actually reminds me about our very own Singapore politics. Will we ever have the spirit of FAIR PLAY in Singapore? The Swiss team could well have go along the rules and take advantage still within the rule of fair play. But it took a further step in great sportsmanship by making sure that it allows its opponent to have a fair chance to the game.

Will we ever have "FAIR PLAY" in politics, particularly in Singapore's politics? I seriously doubt so. It is a well known fact that PAP controls all the machinery in Singapore, from the People's Association to the media. Even when it comes to setting the rules to the game, PAP will always have the upper hand.

For example, take a good look at the following screenshot:



This is taken from PAP's website which hosted the various videos produced by PAP. It clearly stated that this particular video has been uploaded to their webserver on 27 Jun 2008. But wait, the bill on the changes to political films and such was only passed in March 2009!

So it seems that PAP has long decided (at least 9 months in advance) that they are going to utilize internet video for their political cause and campaigning and they should know that they must amend the law before they could do that. Throughout the 9 whole months, they have been in preparation for this amendment, uploading quite a number of videos up to the internet.

But wait, according to their own old law, it is supposedly to be an offence to create or keep video, especially political videos, that have not sent to censor board! I now wonder whether these videos made prior to March 2009 have been sent to censorship board before they were uploaded to the webserver! I doubt they have the experience of going through the hassle of censorship board because recently they have demonstrated that they didn't know how long the censorship board will take to administer a censor on a political video.



There was once a big hoohaa over Martyn See's first political video "The Singapore Rebel" a few years back which was uploaded to the Youtube back then. If I remember correctly, the police was investigating on people having in their possession of this video cd which have not gone through the censorship board just yet.

Actually in my view, this is nothing big nor serious, really. The Film Act is basically an outdated piece of legislation which could only be applied to the past. Ever since video cameras are made easily available to mass consumption, the Film Act has become redundant immediately. It has been further made obsolete by the rapid growth of internet and webvideo applications. The only reason why the film act still exists is for political protection of PAP. But since PAP itself is going to utilize internet video applications to further its own political agenda, it is only natural that the Film Act will be changed or just tailor made to suit its own agenda.

A Good Video from Mr. Brown

But wait, we are talking about FAIRNESS here. Laws or even the Constitution should not be changed just to suit the agenda of the ruling party! In a true democracy, a consultation process that includes all political parties would be held to determine the best rules for the country.

To a great extend, the New Media has provided an effective equalizer to UNFAIR PRACTICES in politics world wide. It is going to be a world wide trend that politics in places like Singapore which POWERS are dominated and monopolized by a single ruling party will have their political playing fields leveled. It could even create a Tsunami effect because they are developing from a point of total control of mass media to a sudden liberalization of information flow via the New Media.

Whether such breaching of media control by the authoritarian regime in Singapore could translate into meaningful democratic development and progress is yet to be seen. But at the very least, we are leaning towards more Fair Play for once. PAP will still have an upper hand obviously, due to the great amount of resources it has on hand. It could even utilize video clips collected in our National Archives to be utilized as one of its political video (watch the video on 1963 Swearing in Ceremony) But the gap between PAP and opposition parties are at least shorten greatly.

However, in preparation for my party, NSP's, National Day Message video, I have met an unexpected incident. My volunteer who have promised to do the filming of this National Day Message has called up and declined to help suddenly. He told me that he was "warned" by somebody that he should not help us to make such video. He declined to mention how he was warned but said that this is different from his past involvement in filming NGO's events because this is for a POLITICAL PARTY (or rather an opposition party).

At the very instance when I heard that, I was quite upset. However I am determined to break this mindset and install the concept of FAIR PLAY in Singapore's political arena. I would respect my volunteer's decision to back off from helping us because he has a family to take care of. But such despicable intimidation is totally outrageous.

It just reminds me that no matter how "OPEN" the PAP claims it wants to be but the truth is, the FEAR element still exists and worse, perpetuate by some mindless people out there. After 44 years of Nation building under PAP's monopoly of power, our country and people are still stuck with a third world political mindset. We may not have built a strong National Identity but we definitely have one common trait, i.e. POLITICAL FEAR initiated and cultivated by PAP's four decades of autocratic rule. This is really the sad situation we are facing right now.

Goh Meng Seng

瑞士拔河隊給台灣政治人物上的一課

瑞士拔河隊給台灣政治人物上的一課

* 2009-07-25
* 中國時報
* 【本報訊】

　高雄世運拔河比賽，瑞士隊奪魁，贏得高度尊敬。原因不僅在於技術優良，更在於其展現了稀有的運動家精神。其對手因傷一人缺陣，瑞士隊也自動減少一人出場較量，贏來的金牌，貨真價實而且榮耀無比。今日的競技場上，多的是不惜犯規以傷害對手使其不能繼續比賽的伎倆，其實與作弊無殊；作弊者比比皆是，不作弊已經變成美德了。瑞士隊的風範，則是遠遠超過了不作弊！他們若是全員出賽，沒有會說他們是作弊，他們有權利全員出賽；他們選擇減少一人，公平競爭，此一運動精神不僅令人動容，也為台灣上了一課。

　這一課很重要，因為台灣幾乎已忘記「不作弊」是最起碼的道德原則了。不講民間詐騙之風盛行，政府人員，能不能夠不作弊，到達弊絕風清的程度？我們可不敢說。最近的一個顯著例子就出在總統府。馬總統要發表治國週記，被網友抓出不少預錄的未來版，馬團隊則以贈書抓包者作為回應；再如某陳情婦人闖進總統府，如入無人之境，勤務憲兵逕自讓婦人離去，指揮部既不報警，也未向上級呈報，府方則以婦人為陳情常客，故作輕鬆。時程尚未推進，即預寫治國週記，算不算作弊？欺瞞哄騙，文過飾非，難道不是作弊？作弊是一回事；不把作弊當一回事，難道不是縱容作弊，支持作弊，等同作弊？

　馬總統其實一向給人不許作弊，不肯輕縱作弊的正面形象。他在特別費官司裡面，碰到檢察官在筆錄上動手腳作弊，深知其害，也深惡痛絕，不惜提出告訴，等到檢方護短縱容，把作弊不當一回事時，總統更不惜請求法院審判，絕不鄉愿，這本是他一貫的作風。可是，總統追究作弊，似乎手軟的時候也不少。這次總統府出的問題，總統似乎並未痛下檢討，姑且不說，數月之前，要求限期徹查軍方買官舞弊大案，國防部臉不紅、氣不喘地使用移送法辦人員統計數字，敷衍回應，連一個真名實姓也無，用文過飾非的方法遮掩察查作弊的要求，難道不也就是再作弊一次？馬總統則也好整以暇，交待國防部繼續追查，這個弊案還會查得下去嗎？這個弊案能夠查的出來嗎？對於作弊，是不是出現了兩種不應出現的態度？

　軍方對於層出不窮的舞弊行為，慣用瞞天過海的作弊手法應付查弊的要求；警察呢？似乎也好不到哪裡去。不到一個月以前，考試院舉辦的警察人員特考，傳出警專出題老師使用校內期末考題充作國家考試考題，為學生放水護航的作弊行為，遭到考生群起抗議，考試院決定改變計分標準，出題人員列為黑名單，可是警專校方從教育長卻一意護短，強詞辯解，至今未見公布被質疑為作弊的老師姓名。國家考試中，發現警察的老師為警察學生考試預試試題作弊，一次作弊，同時破壞了國家考試、警察與老師的形象與名譽，新聞見報之後，從行政院到內政部到教育部到警政署，沒有看到任何徹底追究、嚴禁再犯的作為，同樣也是從上到下鄉愿縱容，讓作弊者僥倖過關，不受責任追究，文過飾非，不就是另一次作弊？

　當然，擺在國人眼前，最大的作弊事件，莫過於前總統陳水扁的舞弊案件了。貴為國家元首，作弊多端卻不肯認罪，將一切的責任推給屬下妻子家人，作弊的功夫，無人能出其右，民進黨呢？則對於作弊的情節，視而不見，諱莫如深，只知以保障人權遮掩失去政治道德正當性的困窘。保障人權是對的，但是不能解決也不能遮蓋作弊所造成的政治道德破產。遮掩作弊所帶來的政治道德破產，無法用聲討作弊以外的途徑獲得救贖。

　與陳水扁相比，當政者作弊的情形那是小巫見大巫。不過，從軍方到警察，從檢察官到老師，從行政到考試，如果作弊之風不斷，文過飾非成習，小巫很快就有一天會變成大巫。馬總統一向痛惡作弊，也一向知過能改，能不能以瑞士隊為師，不要再學陳水扁或民進黨了！

香港銀行斥63億終極「解迷」

銀行斥63億終極「解迷」
(星島)2009年7月23日 星期四 06:30

(綜合報道)

(星島日報報道)糾纏了十個月的雷曼迷債事件，昨天終於可望解決。證監會、金管局以及十六家銷售迷債的銀行達成集體和解協議。銀行將以原價六折或七折的價錢，向投資者回購迷債。銀行出售迷債抵押品之後，會視乎抵押品價值，向投資者支付額外補償。證監會表示，回購方案已考慮了投資者利益，但雷曼苦主大聯盟則堅持要求銀行十足十賠償。

　　十六家銷售銀行將合共要為回購迷債付出六十三億元，而當年銷售迷債所得的兩億元佣金，也要全數撥入一個特殊基金，以應付出售抵押品的法律開支。不過，證監會在昨天的通告當中，並沒有譴責銀行的字眼，換言之，銀行已取得下台階。

　　早在今年一月以及四月，兩間證券行新鴻基投資以及凱基已與證監會達成和解協議，同意以原價回購迷債，而這兩間證券行更遭證監會公開譴責。相比之下，銀行只是退回部分本金，而且沒有受到譴責，境況較證券行為佳。

　　證監會行政總裁韋奕禮昨天表示，回購方案令到投資者可以盡快取回相當比例的本金，是解決迷債事件的適當方法。他又說，銀行銷售的迷債，無論涉及金額以及投資者人數，都遠較證券行為多，因此兩者難以相提並論。證監會將停止對迷債銷售銀行的調查，而金管局副總裁蔡耀君亦指出，只要投資者接納和解建議，金管局將不會對這些個案採取執法行動。不過，假若銷售過程有可能涉及欺詐等刑事罪行，則會繼續跟進。

　　銀行界消息人士表示，銀行會在八月三日開始，向合資格客戶寄出回購要約文件，客戶要在六十天內作出決定。一旦客戶接受銀行提出的回購方案，就需要撤回投訴。

　　他相信，大部分客戶會接受這個方案，因為相對於抵押品價值，客戶所得是「有多無少」，強調銀行已顯示出最大的誠意。但若客戶拒絕接受，他們的權益亦不會有任何影響，「香港的核心價值是法治精神，如果客戶覺得自己有理據，可以透過法律渠道追討。」

　　銀行估計，有九成五客戶合乎回購方案的資格，至於不合資格的百分之五客戶，則是專業投資者、企業及非個人投資者，而在首次購入迷債之前的三年內，曾有五次或以上買賣結構產品或槓桿成分產品的有經驗投資者，亦不符合資格，消息人士表示，這是為了防止道德風險，令到投資者要承擔其投資責任。

　　政府亦歡迎監管機構與銀行達成和解協議，財經事務及庫務局局長陳家強表示，回購方案是從投資者的利益出發，避免投資者經歷冗長繁複的清盤程序以及不必要的訴訟。

　　他又說，期望銀行可從事件中吸取教訓，改善銷售投資產品的程序。

　　中文大學財務學系副教授蘇偉文估計，大部分迷債投資者相信會接納回購方案，以免夜長夢多，繼續追討將要面對很多不明朗因素。



大聯盟不滿終止雷曼調查投訴
(星島)2009年7月23日 星期四 11:47

十六間雷曼迷債分銷銀行與證監會 就賠償客戶達成共識方案後，在報章發表聯合聲明，正式宣布向合資格的客戶提出回購計劃。不過，雷曼苦主大聯盟召集人陳光譽不滿，若客戶接受方案後，當局將不再繼續調查投訴個案。

陳光譽表示，當局如果不再繼續調查，公義便不能彰顯，社會亦不能從事件中得到教訓。但他強調，並非建議投資者拒絕接受昨日公布的回購方案。投資者應考慮個人經濟狀況，決定循法律途徑繼續追討，或接受方案。

而23日早上10多名購買雷曼迷債的市民，在證監會所在的中環 遮打大廈外靜坐，表示不滿證監和銀行達成的和解方案，他們指銀行欺詐，要求百分百賠償。

十六間雷曼迷債分銷銀行在報章發表的聲明指，在過去數月，分銷銀行在增撥大量資源，加快處理所有投訴個案調查和解答客戶查詣的同時，一直竭盡所能為事件盡快尋求一個全面、公平、合理的解決方案。在今次極不尋常、而且無先例可援的情況下，將雷曼迷債事件作為特殊案例處理，在不承擔任何法律責任的前提下，提出回購計劃。回購計劃已獲證監會和金管局 同意作為管調查全面和解方案的一部分。

聲明又指，雷曼倒閉是全球金融海嘯中的一個巨浪，是不測，也是不幸，無人預計到這個有150年歷史，美國 第四大投資銀行，雷曼會在一夜之間倒閉，相信回購計劃會得到迷債客戶及公眾支持。

根據計劃，65歲以上的投資者可取回七成本金，65歲以下的投資者取回六成本金，日後銀行若成功將債券抵押品變現，投資者可多取一成本金，過去已和解的個案，客戶可獲補償差額，預計銀行合共需支付63億元。

Minibond Victims Petition to PM Lee 迷你债券苦主向李总理的网上请愿书

For those victims of banks and financial institutions mis-selling of structured products like Minibonds, DBS High Notes or Pinnacle Notes, the following is a new online petition started off by Mr. Tan Kin Lian to be sent to Prime Minister Lee.

The main thrust of the Petition is to get MAS to implement a similar
settlement to what is happening in Hong Kong, i.e. 60% now and 40% of
the maturity proceeds. This is reasonable and fair as the various investigations done by both MAS and HK SFC have indications that there are systematic mis-selling of these products to retail investors and fixed depositors.

Please help to spread the news about this petition.

http://www.petitiononline.com/PPMCLN3/petition.html

陈钦亮先生再一次带领迷你债券和结构性金融产品苦主向李总理请愿，请求他为苦主们主持公道，力求金融管理局能向香港证监会一样，为苦主们寻求合理的解决方案。那就是，以至少60%的价格回购所有产品并且把从产品抵押品赎回的40%价值归还给苦主们。

这请愿书将在以下的网页收集签名，如果您想签署这请愿书，请点击以下网址：

http://www.petitiononline.com/PPMCLN3/petition.html

吴明盛代启

Concept of Power II- Hong Kong vs Singapore/PRC , Democracy, Social Justice & National Identity

There are a series of happenings for the past weeks that provide an interesting material to make comparative study of the impact of democratic progress to welfare of the people.

I was only thinking of making democratic comparisons between Hong Kong and Singapore at the beginning of the month after my participation of the Hong Kong 1 July protest march, but the unexpected 5 July racial/ethnic riot has added another perspective to my original script.

The Source of Power

I will start with the call for Universal Suffrage for the election of the Hong Kong Chief Executive. Many people may view such "hard political issue" difficult to relate to their daily lives but the Lehman Brothers Minibond issue has brought great contrast to possibility of how different a government under different degree of democratic progress would react to protect the interests of small investors versus big financially powerful corporations.

The fundamental reasoning for the call of Universal Suffrage is to transfer the power of appointment and empowerment from the few individuals (800 to be exact) to the general public. These 800 individuals are mostly screened and approved by the basic source of power, the Beijing government.

Thus, it would mean that anybody who wants to be elected to be the Chief Executive of Hong Kong, he will have to get the backing of the majority of these 800 Bejing appointed delegates. Most of them are rich, powerful and influential individuals in Hong Kong, representing the business community which includes the property developers, banking and finance sectors etc. Of course there are token representatives from the respective professional functional groups and unions but most of these people are perceived as appointed by or proxies of Beijing government.

With such a power structure, it is natural for those who are in the position of Chief Executive to please the big boss who appointed him in the very first place. At the very least, don't agitate or make the big boss angry. On the other hand, he must maintain cordial relationship with those 800 delegates who voted him as proxy to the Beijing Government. Many of them are tycoons or proxies of such rich and powerful tycoons representing their business and organizations' interests.

Thus in Hong Kong, it is not unusual to hear the people or newspapers complaining of "官商勾结"， meaning collusion of the government and businessman in return of favors.

Buttered Side up

To illustrate how the structure of power affects the political behavior and decisions made by the Chief Executive, the simple request for Universal Suffrage by the Hong Kongers was flatly turned down by Donald Tsang recently in Legislative Council. His reasoning was that the Chinese People's Congress (which of course controlled and directed by the Beijing Government) has closed the case with a time table set for 2017 to implement the Universal Suffrage (instead of 2012). He is not going to go against the political will of the Beijing Government by bringing this up again to the Chinese leaders. Neither will he make any arrangement for those Legislative Council members (i.e. equivalent to our MPs) to visit Beijing to put up their views and requests of Universal Suffrage directly to the Chinese leadership.

It is obvious that Donald Tsang's main concern is to avoid agitating the Beijing Government even though there is strong voices on the ground to demand for Universal Suffrage in 2012. He is less interested in bring the voice of the Hong Kongers to Beijing. This is understandable as his reference of empowerment comes directly from Beijing Government itself.

Accountability of the administration is basically skewed towards the Beijing government who is the source of the power rather than the Hong Kongers. In any system that promotes appointment of key political leaders by the few powerful people, it would always be so.

The Pillars of Democracy & Minibond Saga.

Lucky for Hong Kong, there are two other three pillars of democracy to depend on. The very professional and independent judiciary, the freedom of press and the Legislative Council (i.e. parliament). Apart from that, there is a guarantee of freedom of expression by the layman via street protests.

The Lehman Brothers Minibond saga has demonstrated the importance of having these pillars of the democratic system. The Hong Kong Administration may not have the political will to settle the Minibond saga once and for all using its administrative powers, just like Singapore's MAS. This is basically because many of those in the 800 delegates that elect the next Chief Executive are well connected to the banking and finance sector. By right, the regulatory role should fall flat on the Hong Kong Monetary Authority (HKMA) but eventually, this hot potato was kicked to the Securities and Futures Commission (SFC). HKMA is directly under the prevail of the HK administration of finance ministry while SFC is more or less an independent commission to oversee fair play in the financial market, mostly on the stock exchange and other financial derivative markets. It would be strange to have the SFC instead of the HKMA to oversea regulation over banks who mis-sold structured products. Anyway, this is another story.

SFC being an independent commission did an investigation into the whole matter and took a hard stand on the banks and financial institutions that mis-sold the structured products. It was not satisfied with the initial general settlement proposal (read by earlier posting, overall 60% to 70% compensation) made by the 16 banks and has in fact warned of sanctions on several financial institutions. Some financial institutions have eventually made FULL compensation to ALL of their clients while others are forced to make formal GENERAL SETTLEMENT PROPOSAL.

The Hong Kong Minibond victims are also helped by Pro-Democratic Legco members to force the Legislative Council to set up an independent Legco Committee of Inquiry. They were able to force the setup of such committee of Inquiry which is empowered with special Legco rights and power to call for witnesses mainly because the Hong Kongers have voted in slightly less than half of the Pro-Democratic Legco members as compared to the Pro-Beijing Legco members who are mainly elected via the Functional Group categories. If the composition of the Legco members are just like Singapore Parliament with only 2 or 3 opposition MPs, I really doubt that such Committee of Inquiry could be set up at all.

The Minibond saga in Hong Kong is coming close to GENERAL SETTLEMENT with FAIR compensation to be made to ALL investors mainly due to the power of the Democratic system that allows it to happen. Unlike the plight of Singapore's Minibond victims who are left to their own to fight for their rights and interests, the solid foundation of Hong Kong's democratic system has allowed Social Justice to prevail.

Forging An Identity

The Democratic progress and development in Hong Kong also allows the Hong Kong identity to be enhanced further. From the various postings on the Hong Kong protest march and 4 June memorial service, we an see that young Hong Kongers have been cultivated with a strong sense of social justice and political mindsets.

For an identity to be forged, there must be meaningful collective memories to start with. Collective memories can come in many forms like unique distinctive iconic buildings, common experiences and even food or culture. The unique peaceful protest march of tens of thousands of people without any incidents of violence is one of such amazing collective memories that one would have as a people.

Although Hong Kong is not a country but the Hong Kong identity is unique to many people. Hong Kongers feel that they have the responsibility to mold the future of Hong Kong instead of leaving it to the will and fancy of the Beijing Government. The spirit of "self-determination" is a strong molding factor of Hong Kong identity in this aspect.

As contrast to young Singaporeans who may hold "defeatist" mindset in wanting to initiate a change or molding the direction of their country, the young Hong Kongers, as young as secondary students, would take to the street to voice out their social-political views in the hope that they could maintain the political pressure on the government of the day to meet their demands.

There was a survey study of young Singaporeans and the result was that a substantial percentage of them would consider migration as the ultimate option for them in the future. This is alarming for a COUNTRY that has existed for more than 50 years. Singapore does not face famine, political instability nor any natural disasters. Why would young Singaporeans plan to leave their country? This is, in my view, a National Identity crisis.

Democracy, Social Justice & Fairness, Ethnic Harmony

The riot and unrest in China's Urumqi has raised alarms on racial or ethnic harmony. It is a timely case study for us to understand how such tragedy should be avoided or deal with if it has already happened. Favorism or discrimination will not solve racial and ethnic troubles.

A country needs a system of SOCIAL JUSTICE & FAIRNESS, INDEPENDENT JUDICIARY and DEMOCRACY to ensure that the leaders from top to bottom take heeds of the voices of different races and ethnic groups on the ground. As we can see in Hong Kong's case, minority races or even foreign maids are allowed to go for protests to voice their grievances. In fact, Hong Kong has a commission which looks into Equal Opportunity for all, particularly in employment.

Lessons to be Learned

The very first lesson to be learned is, the political structure and system MATTERS to ALL of us. This is shown by the differences in the way Hong Kong and Singapore government respond to the Minibond issue. While Hong Kong Minibond victims are heading towards possible GENERAL SETTLEMENT with a substantial compensation facilitated by the independent and separation of power along with democratic means to exert political pressures, Singapore Minibond victims are stuck with the only option of going for potentially expensive lawsuits. MAS has only taken the token step of putting a light slap on the wrist of banks who apparently have systematically mis-sold these high risks structured products.

The second lesson to be learned is that our National Identity could not be forged simply by singing nationalistic songs once every year during National Day. Engagements and participations of the young and old in the political discourse and democratic processes are of paramount importance in forging a collective memories, ownership and common identity among the population.

The third lesson is that Social Justice & Fairness could only be supported and sustained by a truly democratic system with high level of citizen activism on the ground. This will maintain the necessary checks and balances to ensure racial and ethnic harmony within.

On the other hand, in order to make our ruling party PAP to really grasp the reality of empowerment by the people, ideally ALL wards should be contested. Although we do not have a good model of democracy or even an ill-democratic system with controlled press and skewed electoral system, but at the very least there is still a way to make PAP MPs and ministers more accountable to the people. This is by means of making each and everyone of them to go through the process of REAL ELECTION rather than walk over.

If they are allowed to walk over lightly, they would think that what matters most is the PAP's SELECTION process, not voters' choice. In the end, they may end up singing more praises to the PAP leadership instead of voicing out the various concerns of the people who are supposed to be their source of power.

Last but not least, we need MORE ELECTED opposition MPs with FULL POWERS in parliament (instead of NCMPs). In my view, the proportionate representation system is the best system we could have to make sure that we have a parliament with a balanced representation of views over the wide population spectrum.

Goh Meng Seng

204 Customers sue Singapore’s DBS over investment loss

Customers sue Singapore’s DBS over investment loss
July 12, 2009 by admin


Source: Reuters, 10 July 2009

SINGAPORE, July 10 (Reuters) - More than 200 customershave sued Singapore’s DBS Bank in a bid to recover investment losses arising from the collapse of U.S. investment bank Lehman Brothers.

Siraj Omar, a director at Premier Law, told Reuters on Friday his firm had filed a claim on behalf of 204 investors in a Singapore court. He declined to discuss the case or reveal the size of the claim, which according to the Straits Times newspaper was around S$17 million ($11.6 million).

The investors had purchased a callable basket of credit-linked notes, called High Notes 5, from DBS Bank, a unit of DBS Group, Omar said.


A DBS spokeswoman confirmed receipt of the claim. She said the suit was without merit and that DBS planned to contest the suit, which is the first involving the bank’s High Notes 5 product.

News of the lawsuit had almost no impact on shares of DBS Group, which were up 0.4 percent on Friday morning at S$11.58 in a generally flat stock market.

Financial institutions around the world have been hit by complaints and lawsuits arising from the sale of interest-bearing structured products linked to Lehman that paid higher interest rates than regular savings deposits.

For example, a class action suit was launched in November against UBS in the United States that alleged the Swiss bank had sold Lehman-linked notes as suitable for investors seeking to protect their principal investment.

News of the suit against DBS comes three days after Singapore’s central bank banned DBS and nine other firms from selling structured notes, citing various issues, such as their failure to adequately train the staff who sold such products.

According to a report released by the Monetary Authority of Singapore (MAS), DBS which received the shortest ban of six months, had sold over S$100 million worth of High Notes 5 to 1,083 investors that became worthless after Lehman’s collapse.

The bank has to-date paid about S$7.6 million in compensation, the central bank’s report said.

MAS said the failings identified in its investigations “do not automatically mean that the financial institutions are liable to individual investors.


News reported by Straits Times:

204 DBS High Notes 5 investors suing bank - By Francis Chan 10 July 2009 ST



MORE than 200 investors who lost a total of about $17 million on structured notes sold by DBS Bank are suing the bank in a bid to get their money back.

Legal firm Premier Law, which served notice on DBS yesterday, said the claim is based on the 'prospectus and pricing statement relating to the [DBS High] Notes 5'.

The investors want the notes declared 'void' and their stakes repaid.

'The investors have taken this course of action after careful consideration, having sought advice from their legal advisors,' said Premier Law.

A DBS spokesman said last night that the bank remains confident that the case is 'without merit and we will defend it'.

The Straits Times understands that the 204 investors involved in the suit had lost about $17 million on the complex structured notes.

More than 1,400 investors here bought $103 million worth of DBS High Notes 5. More than half of them invested $50,000 or less.

A report from the Monetary Authority of Singapore (MAS) on Tuesday detailed flaws in the sales processes of 10 financial institutions - including DBS - that sold products like DBS High Notes 5 linked to failed US investment bank Lehman Brothers.

DBS High Notes 5 were offered to better-off customers last year with a promised annual return of about 5 per cent, but the investors were told by the bank in October that their entire stake had been wiped out with the collapse of Lehman.

Many investors complained that they had been mis-sold the complex structured notes, with some claiming they were told the notes were a low-risk investment.

The MAS report found that the 10 institutions had applied different internal controls and failed in a number of areas.

It also said that some institutions did not ensure that staff were properly trained and had accurate and complete information needed to sell the notes.

In the case of DBS, the report stated that 49 of its relationship managers, who had not taken the required training course, had sold the notes to 303 clients.

The MAS banned DBS from selling new structured notes for at least six months starting from July 1. The other nine institutions received similar bans, with Hong Leong Finance being barred for two years, the harshest penalty.

However, the MAS made it clear that the institutions' failings and the penalties they received do not automatically mean they will be legally liable to investors.

Premier Law said the investors' move was not in response to the release of the findings by MAS.

'This group of investors have been considering their options for several months away from the media spotlight, and it was only after careful consideration that they have decided to take this route to recover their investment,' said Premier Law's Siraj Omar.

The investors also sought the opinion of Professor Michael Furmston, dean of the Singapore Management University's law faculty, said the Premier Law statement.

An SMU spokesman said that Prof Furmston was travelling and could not confirm if he was involved in the case in his personal capacity.

According to the MAS report, DBS paid out $7.6 million to 197 affected investors out of the 866 complaints it had investigated and ruled on.

The bank's payout amounted to about a tenth of the $70 million to $80 million DBS had set aside to compensate investors in Singapore and Hong Kong earlier this year.

The Straits Times understands that most of the investors in the Premier Law group have gone through the three-step complaints resolution process recommended by the MAS.

The MAS had earlier urged investors who could not resolve their differences with the institutions to ask the Financial Industry Disputes Resolution Centre (Fidrec) to resolve their dispute. It also urged investors to avoid taking legal action unless they had exhausted the three-step process.

It is not clear whether any of the 204 investors involved in the suit had accepted compensation offers before embarking on this legal route.

franchan@sph.com.sg

香港證監迷債賠償方案 首曝光

證監迷債賠償方案 首曝光 本金退六成 事主再分抵押品四成
(明報)2009年7月10日 星期五 05:05

【明報專訊】雷曼迷你債券16家分銷銀行與證監會 一度膠着的和解談判，出現新發展。消息人士透露，證監會已根據早前中銀香港 （2388）的六成回購方案（簡稱「中銀方案」）為基礎，向銀行界提出反建議，要求銀行在投資本金的六成之上，再把日後收回抵押品剩餘價值的40％，也歸還客戶所有。

按此計算，大部分迷債持有人可取回近90％的本金，這批迷債以金額計已佔總數逾八成。而分銷銀行須承擔的損失將高於「中銀方案」，對於如何回應證監方案，銀行未有任何共識。證監對有關消息不予置評。

自分銷銀行上月底主動與證監會談判以來，雙方一直就「中銀方案」——以本金六成回購，65歲以上長者獲七成回購的建議，討價還價。證監會認為回購價太低，又指部分抵押品剩餘價值高過六成；銀行則認為證監假設的抵押品價值過高。

證監對方案不置評

惟消息透露，近日談判進度加快，證監會以六成「中銀方案」為基礎，接受六至七成的回購底價，但條件是銀行在抵押品解凍後，將剩餘價值的40％給予客戶，其餘60％價值為銀行所有。根據此方案，剩餘價值較高的迷債系列，客戶最終取回的價值，與「中銀方案」有明顯分別。假設有關抵押品剩餘價值為70％，客戶除了取回六成的回購底價外，更可取回剩餘價值的40％，即28％，總共收回本金的88％。若抵押品價值已跌至接近0％，客戶最終只能取回六成的回購價。

按安永會計師事務所去年11月的估值，除了系列5至9價值跌至0.82％，及系列15至18價值較低（少於13％）外，大部分系列的剩餘價值，均達到約64％。在證監會方案下，後者最終可取回幾近本金90％，較「中銀方案」取得的六成多金額高（見表）。按政府去年公布的資料，這些系列的投資金額達 102億元，佔總體迷債125億元的82％。

事主最高可取回90%本金

不過，這只是證監會對銀行提出的建議，銀行將會如何回應，仍待商討。據悉，昨日16家分銷銀行再次開會，但尚未深入討論證監會的建議，因為各銀行仍就六成和解要付出的成本，等候公司董事會的同意。據了解，銀行曾經向證監會提出，在「中銀方案」之下，額外付出抵押品剩餘價值的5％予客戶，與證監會方案的要求有很大距離。

據悉，證監會認為新方案較「中銀方案」可取，因為在「中銀方案」下，若抵押品剩餘價值高於本金六成，銀行根本毋須作額外賠償，不能反映銀行要為不當銷售而應承擔的責任。在「證監方案」下，銀行則須承受額外的損失，而且高於客戶的虧損，證監認為這樣才較為「合理」。

本報以未償還迷債金額125億元計算，銀行首先要付出六成（即75億元）的和解底價，即使銀行有權取回所有抵押品的價值（按安永估值為67億元），仍要將當中四成（26.8億元）支付予客戶，最終損失達34.8億元。較「中銀方案」損失15.6億元，要多付出近20億元。

（明報記者羅羽庭、姜靜嫻報道）

Urumqi Protests- Democracy, Social Justice & Harmony

Photo from TimesOnline

The recent riot happening in Urumqi has provided a great contrast to the peaceful protest march that Hong Kong had on 1st July. Of course, the nature of protests are vastly different. Urumqi protest is basically racial in nature with protesters demanding fair treatment to their own kind in another incident happening in Guangzhou.

There are many inherent reasons behind such perceived racial discrimination. Contrary to popular perception, China is a multi-racial country. The Uyghurs are just one of the many races in China. Historically, Xinjiang has been perceived as a place of a "defiant" province. It has been on and off an independent state in Chinese history and has even threaten the security of the Hans controlled territory. The peak of XinJiang dynasty was Liao Empire during the Song Dynasty. Thereafter, it has been conquered by the Mongolian and subsequently controlled by the Hans again during Ming Dynasty. It was during the Mongolian occupation that Islam became the main religion of that region.

However, Xinjiang has always been a hot spot of rebellion against the rule by the Chinese dynasties, be it Hans as in Ming Dynasty or the Manchurians as in Qing Dynasty. Due to the fact that it is geographically far away from the center of power of the Chinese dynasties in the North, those who are sent to Xinjiang to rule over the people there normally become the "mini-Emperor" there. Sometimes they would even create racial tension or unrest/riots just to get the attention of the Emperor thousands of miles away to send more money and aids to them.

Since the Chinese Communist Party took power in China, Xinjiang has become a province with autonomy powers. The assimilation of the Hans people has altered the demographic structure as well as economic structure. Most Hans people live in the main cities while the rural areas are populated by the minority races, including the Uyghurs. The income disparity between city dwellers and rural farmers is inevitable in the present structure of economic development.

With the basic understanding of the history and background of Xinjiang, we will now look at what is happening in Urumqi. When the riot broke out in 5 July, the Xinjiang authority was quick to point finger at the exiled Uyghurian separatist group, World Uyghur Congress which is led by Rebiya Kadeer of inciting the riot. Rebiya Kadeer has denied the allegation. Up till now, the Xinjiang Autonomy government has not disclosed their so called "concrete evidences" yet.

On the other hand, there were reports and questions asked about how the supposedly peaceful demonstration of the Uyghurs against the perceived unjust treatment of their people in Guangzhou turned into violent riot.

Interesting enough, the Chinese Prime Minister Wen Jiabao did not issue any statement at the earliest possible opportunity. Neither did we hear any comments made by Chairman Hu Jingtao. The Xinjiang leaders have claimed that they have concrete evidences that Rebiya Kadeer and her World Uyghur Congress have instigated and planned for this riot but this statement has not been repeated by either the Prime Minister Wen nor Chairman Hu.

The truth is, after Chairman Hu returned to Beijing to conduct an emergency meeting on this riot, the statement issued was about punishing those rioters and maintaining law and order in Xinjiang, particularly Urumqi. There is no mention of the separatist Uyghurian movement nor the World Uyghur Congress. This is intriguing indeed because this contrast greatly to the kind of statement the Chinese government has issued against Dalai Lama during the last year's Tibet riot.

Many news journalists and reporters, particularly those from Hong Kong, would have noticed the change in strategy that the Chinese authorities have adopted this time round with regard to the incident. Unlike the past, they have allowed foreign reporters and correspondents to visit the place of riot. Although internet and phone networks were disrupted in Urumqi, the communication network is made available to the specific hotels that were allocated for the reporters to stay. The Chinese Government has finally learned how to deal with foreign press in order to upgrade its international image.

However in my view, the root of the this riot lies with the Xinjiang's authority. My guess is that the peaceful demonstration has turned into violent riot was basically due to the hardcore crack down of the demonstration. Someone has made the political judgment to crack down on that peaceful demonstration in the hope of quelling it once and for all. But somehow, it just turned ugly with high racial emotions on the raise.

If the authority in Xinjiang took a different approach right from the start, using the police force to "FACILITATE" the demonstration and allowing the high emotional pressure to have an opportunity to be let off, the result may be very different.

The conventional way of dealing with protests should be changed from viewing all demonstration as bad and treating it with a confrontational approach, to a more tolerant stand. A government stepping into the league of World's most influential governments should take freedom of expression with more tolerance.

The key to the change of mindset is democratic means of electing the various leadership on the ground. This is due to the fact that if the leaders are "selected" by the few people on the top, it would be natural for these leaders to take the views of the these top few more seriously than those he is leading on the ground.

In fact, leaders from the ground would want to find all ways to please those from the top instead of taking serious care of those on the ground. Thus when such demonstration happened, these leaders would naturally be afraid to be seen as "ineffective" or even "useless" by those on the top and thus, the tendency to use forceful means to crack down these originally peaceful demonstration would be higher. Such mindset may just backfire and ignited exploding emotions on the ground, turning it into a riot.

If the leaders of Xinjiang and Urumqi are democratically elected by the people there, I believe they might have handled the whole issue very differently right from the start.

Racial riot is one of the most difficult issue to be settled for any government. The key of mending the cracks of racial harmony and healing the damaged emotions is for the Chinese government to exert Social justice to the whole issue. Social Justice must be done and seen to be done.

While it is only right to punish those rioters who have killed, robbed and hurt others, investigation should also be made into the death of those Uyghurs. Did the police force use excessive force to crack down the demonstration causing the death of these Uyghurs as claimed by some? Who gave the order for such crack down?

Trust and harmony could only be reinstated if and only if just actions are taken against those who have created trouble are being punished accordingly. This must include those who bear political responsibility.

The Chinese government may not want to punish those officials who have made the wrong political judgment for fear of undermining its own authority. But the truth is, if it refused to do so, the Uyghurs would feel even more discriminated, alienated and angry. This will not heal the emotional wounds but may worsen it in contrary.

Again, for a non-democratically elected government, it may not see the need to smoothen out the racial emotional upheaval in the expense of "eroding its authority". Few dictators or Emperors in the past history could bridge the racial gap between different races well. Most of the time they look upon such racial frictions as rebellion against their authority.

But I still hope the Chinese Government would make the "unconventional decision" in making things right in this instance. This would help it to prove to China's many other races of its ability to maintain social justice for each and everyone, every race in China. This would be the basis of long term racial harmony in China.

Goh Meng Seng

After Note 14 July 2009:

Interesting enough, the Chinese Communist Party Central Committee has announced on 13th July 2009 a series of directive on disciplinary actions against Party Cadres and leaders.

For the very first time, the issue of protests has been listed one of the item in this directive. Those party leaders (mid-level leaders) that made wrong political judgment or decisions that result in massive protests will be censured and stripped of their official duties. Those who mismanaged or mishandled protests by the people will face the same disciplinary actions.

This directive sets the rules to make local officials and leaders to be accountable for their misdeeds or wrong political judgment and decisions. It would be interesting to see whether the Chinese Communist Party could exercise such disciplinary actions on those errant party cadres, starting from the incident in Urumqi riot on 5 July.

全國紀委書記座談會13日在北京召開，會議要求各地區各部門貫徹落實近日中央針對黨政官員問責、巡視工作、國企高管廉潔從業而接連頒布的三部文件，以此作為當前加強反腐倡廉建設的重要政治任務，進一步完善幹部監管，加強反腐，澄清吏治。

【本報記者馬浩亮北京十三日電】

中共中央政治局常委、中央紀委書記賀國強出席了全國紀委書記座談會。中央紀委副書記何勇在會上強調，要以改革創新的精神、科學嚴謹的態度、真抓實幹的作風，抓好《中國共產黨巡視工作條例（試行）》《關於實行黨政領導幹部問責的暫行規定》《國有企業領導人員廉潔從業若干規定》三項法規和《關於開展工程建設領域突出問題專項治理工作的意見》的貫徹落實，不斷完善懲治和預防腐敗體系，切實加強反腐倡廉建設。

　中央近日同時頒布針對黨政官員問責、巡視工作、國企高管廉潔從業的三部文件：《關於實行黨政領導幹部問責的暫行規定》、《中國共產黨巡視工作條例》和《國有企業領導人員廉潔從業若干規定》。這三部文件是在今年5月22日的中央政治局會議上審議通過的。其中，《關於實行黨政領導幹部問責的暫行規定》成為規範推行問責制的綱領性文件。

七種問題將被問責

《暫行規定》規定，黨政領導幹部出現七種問題將被問責。一是決策嚴重失誤，造成重大損失或惡劣影響；二是因工作失職，致使發生特別重大事故案件，或短期內連續發生重大事故案件；三是政府職能部門管理、監督不力，導致重大事故；四是濫用職權，強令授意實施違法行政行為或者行政不作為，引發群體性事件或其他重大事件的；五是對群體性、突發性事件處置失當，導致事態惡化，造成惡劣影響；六是違反幹部選拔任用工作有關規定，導致用人失察、失誤；七是其他給國家利益、人民生命財產、公共財產造成重大損失或惡劣影響等失職行為。

《暫行規定》規定了責令公開道歉、停職檢查、引咎辭職、責令辭職、免職五種問責方式，並對問責官員的範圍做了明確界定，包括中共中央、國務院部門及其內設司局、處室機構的領導成員，縣級以上各級黨委、政府及所屬工作部門的領導成員和這些部門內設機構的領導成員。對鄉鎮街道黨政領導實行問責亦適用此規定。縣級以上黨委、政府直屬事業單位以及國有企業、國有金融企業領導，也參照《暫行規定》執行問責。

免職一年內不得復職

針對很多被問責官員免職一段時間後又悄悄復出，換地區或換部門繼續做官的情況，《暫行規定》明確指出，引咎辭職、責令辭職、免職的黨政領導幹部，一年內不得重新擔任與其原任職務相當的領導職務。可根據工作需要以及本人情況，酌情安排適當崗位工作任務。一年後如果重新擔任與其原任相當的領導職務，除應當按照幹部管理權限履行審批手續外，還應當徵求上一級黨委組織部門的意見。

另外，也有公眾質疑，有的官員在出現問題後，借問責制辭職，從而逃避黨紀國法懲罰。中紀委專家對此表示，實行問責不能代替黨紀政紀處分，問責後仍可依照有關規定給予被問責者黨紀政紀處分，涉嫌犯罪的，移送司法機關依法處理。

香港銀行銷售雷曼迷債調查已有初步結論

銀行銷售雷曼迷債調查已有初步結論
(星島)2009年7月7日 星期二 13:00

證監會 行政總裁韋奕禮繼續在立法會 雷曼小組聆訊作供，他表示，部份針對銀行銷售雷曼迷債的調查，已有初步結論，正與銀行討論。

韋奕禮表示，按現行法例，證監會並無權力強制要求分銷商向客戶作出賠償，但經調查後，於考慮如何懲處時，分銷商與客戶的和解協議，以及對客戶作自願賠償的因素，亦會被納入考慮。證監會作最後結論時，會考慮三個元素，包括和解方案能否彌補客戶損失、有關機構有無措施減少日後違規的可能、以及方案對其他機構有否阻嚇作用。

韋奕禮指出，由03年4月至雷曼倒閉前，證監會調查有關經紀涉嫌違反操作守達527宗遭紀律處分，當中5%投訴銷售不當，涉及2000客戶，全部已紀律處分，包括撤銷牌照，另有168宗達成和解。但韋奕禮稱，現未有相關和解賠償金額比率，亦不評論有報道指雷曼迷債分銷銀行早於新年前後已向證監會提交賠償和解建議。

只強調沒有受到政府的壓力，重申沒有權力要求銀行與客戶和解，並指證券行新鴻基 及凱基僅約四至六個月，就完成和解方案，已算很快。 委員會主席何鍾泰 提醒，有關雷曼事件的賠償並未包括於研訊範圍之內。

另外，韋奕禮稱，證監會05年開始研究，要求中介人披露銷售金融產品的佣金，但當時認為需要先諮詢市場意見，確保措施成效，有關諮詢會在今年內進行。他認同，銷售人員按銷售取得佣金存在利益衝突，但情況並不侷限於金融業界，再者中介機構有責任確保銷售過程符合規格，而所銷售產品對投資者合適。

他提及，最激進做法是英國 金融服務局禁止收取佣金之做法，但他認為，即使本港於佣金制定未有確立守則，按現時一般手則要求，對客戶公平做法已有所涵蓋。他又指，已向當局提出建議，成立投資者委員會，以增加保障投資者權力，期望相關工作可加快進行。

Hong Kong Democratic Progress - 1st July Protest

It was a hot and sunny day on 1st July 2009. But the turnout for the 1st July protest march exceeds 30 thousand people (according to my estimate, the number should be about 40 to 50 thousands people). This is the largest protest march ever after the present Chief Executive Donald Tsang took over office.




Hong Kong is an interesting society where its residents are practical people who are calculative to the dot when it comes to business dealings. However, the other side of Hong Kongers is all encompassing, tolerant, compassionate and politically altruistic.

For example, although the organizers of this 1st July protest march have their specific slogans and agenda of pushing for universal suffrage for the political appointment of Chief Executive, but they do also allow different groups of people with different issues and demands to join their march.

Groups of people fighting for their different agenda joined the protests to make their voices heard. There are people who are fighting to retain their village from being acquired by developers.




There are people who fight to get their voices on environmental issues heard as well as preserving of landmark buildings from being demolished. There are also individuals putting up their own slogans and stories.

A young girl accompanied by her mother to protest against Environmental pollution



The most interesting part is that the younger generations are participating actively in these political activities. I am amazed at the level of participation by the young Hong Kongers in both the 4th June memorial service and the 1st July protest march.

They may be individuals or small group of people, putting up slogans, placards or even issuing their own (social-political) statements

A Public political statement made by the collective group of Hong Kong universities' student publications which includes the Hong Kong University Student Union, Hong Kong Chinese University student publication committee, Hong Kong City University etc.


On top of that, some of the youngsters in Hong Kong have taken to creative means of protest, by forming the Hong Kong Complaints Choir. This is a movement initiated by a Finnish organization which have grown internationally. Singapore, too, has one Singapore Complaints Choir but it was banned from public performance by the PAP government using a very lame excuse that there were foreigners in the choir.






Some individual youngsters get their hands on their semi-professional cameras to record down the happenings of the protest march, to be produced into video or news clips to be posted on the internet. I have interviewed one of the youngster and they told me that they have bought their second hand Panasonic camera set from China for the price of HK$7000! And they intend to edit the images into video clips which will then to be posted on the internet. This is part and parcel of grooming professional young citizen reporting.







Many people would think that Hong Kong is a all Chinese society but the truth is, it has many other races which includes the Europeans, Indians, Nepalese, Pakistanis etc. I have seen more other races participating the annual 1st July protest march in recent years. Apart from that, there were foreign maids and workers who were fighting for their rights and equal treatments under the law, particularly the minimum wage legislation.



At first glance, it would be counter-intuitive for Hong Kongers to allow these foreign workers or maids to ask for more pay or labor protection because it would mean that the huge middle class would have to pay more in terms of wages to their domestic maids.

But for the Democratic and Human Right fighters, they are fighting for a fair and just society and this would include foreign workers or maids contributing to their livelihood and economy.





They were given the chance to voice out their grievances on the stage provided by the organizers and in return, they presented a small performance of dance for the audience.



Furthermore, such platform allows them to attract media attention to their plight. In the following photo, a CNN correspondent has approached the leader of the Federation of Asian Domestic Workers for an interview and I believe they will make the first link up for future feature interview.



Such big political event could not be made possible without the contributions of various volunteers.

Every year, political parties and groups have recruited quite a number of party volunteers from such events like 4th June and 1st July gatherings. On top of that, they have also collected quite a substantial amount of donations from the public during these events by selling books, publications or plain soliciting donations.



On the other hand, such events wouldn't be possible without the contribution of the police force in maintaining order during the march. Although there were times whereby protesters exercise some of their civil disobedience tactic but the police has been very accommodating and tolerant in carrying out their duties.




Last but not least, Hong Kong won't be a successful, clean and efficient society without the group of diligent cleaners. The efficiency of the Hong Kong system could be seen by the kind of arrangement they have made even for such anti-government protests. Cleaners and road washing vehicles tailed the protest marchers and start to clear up rubbish so that the road could be opened immediately to other road users right after the last protesters left.

One of my friend called me up one day after the protest march to ask whether I was arrested by the police. I was surprised why he asked that. He said that Singapore Straits Time has reported that some protesters were arrested the day before. This is a gross mis-reporting. The 100 or so protesters were removed from the premise of government house which they planned to stay overnight in demand to have a dialogue with the Chief Executive Donald Tsang. They were forcefully removed from the premise but no one was arrested.

These are the minority of Hong Kongers that would go into Non-violent Civil Disobedience Action but generally speaking, the Hong Kong authorities are more tolerant towards them as long as there were no harm nor damage done to public interests.

I have painstakingly listed out some of the observations I have made in Hong Kong on their progress in becoming a truly open and democratic society for the reason that I believe Singapore can become one too.

There are quite a number of benefits from such development which may help Singapore solve some of the important issues that we are facing, National Identity.

I shall dealt with this issue in my next posting.

Goh Meng Seng

Hong Kong Banks Offer Formal Minibond Settlement

Hong Kong Banks Offer Formal Minibond Settlement, Sing Tao Says


By Kelvin Wong

July 3 (Bloomberg) -- A group of 16 Hong Kong banks that sold so-called minibonds linked to Lehman Brothers Holdings Inc. have sent a formal proposal to the city’s securities regulator to settle on a refund to investors, Sing Tao Daily reported.

The banks may suffer losses of as much as HK$1.5 billion ($193.5 million) in the proposal, the Hong Kong-based, Chinese- language newspaper said, without saying where it obtained the information. The banks offered to repay investors between 60 percent and 70 percent of the principle of credit-linked notes arranged by a local unit of failed Lehman, Sing Tao said.

Losses sustained by individual investors on the notes, which lost almost all their value after Lehman collapsed, have ignited street protests and demands for refunds from banks and brokerages. The city’s securities regulator has told seven of 19 banks under investigation for misconduct related to sales of the notes that they face possible sanctions, Martin Wheatley, the head of the agency, said June 23.

A total of HK$13.9 billion of the credit-linked notes were sold to Hong Kong individuals, according to the Securities and Futures Commission. BOC Hong Kong Holdings Ltd., Bank of East Asia Ltd. and Wing Hang Bank Ltd. are among lenders that sold the notes.

Sun Hung Kai Financial Ltd. and KGI Asia Ltd. have finished buying back notes they sold at prices equal to the principal invested, the SFC said yesterday. The two local brokerages are the only minibond vendors who have fully refunded investors, with Sun Hung Kai paying about HK$86 million and KGI about HK$1.5 million.

The securities watchdog is unlikely to accept the banks’ proposal, according to today’s Sing Tao report. The SFC is demanding that banks follow Sun Hung Kai and KGI and repay the full principal, Sing Tao said.

To contact the reporter on this story: Kelvin Wong in Hong Kong at kwong40@bloomberg.net

Hong Kong Minibond heading for possible settlement!

The power of democratic movement in applying great pressure to force both the administration authority and the 16 banks to provide settlement proposals for the Minibond issue is really amazing in Hong Kong.

Right after the 1st July protest march organized by the Hong Kong Minibond Victims Alliance, the 16 banks who are involved in the selling of the Minibond has made settlement proposal to the Hong Kong administration to settle once and for all the Minibond issue.

The key points are:

1) Those Minibond victims who are below 60 years old will get proposal to sell back their Minibond at 60% of their original value.

2) Those who are above 60 years old will get an offer of 70% of their original value.

The banks have made promises that if the value of the collaterals of these structured products are higher than the value offered after they were sold off, the excess amount will be given back to the Minibond victims!

This proposal is made using the key by-back proposal made by Bank of China earlier.

Although some analysts have stated that the buy back value is on the low side but in my view, this is a main big step gained after so many months of continuous street fighting by the Minibond Victims Alliance.

As stated in my earlier posting on this Minibond saga, investors will have to take part of the responsibility in making the investment decisions even though they have been misled. Getting 70% or 80% of the value back is reasonable in my opinion. 60% is on the low side.

I truly hope that the banks and authorities in Singapore could work towards some similar settlement proposal for every Minibond victims. If DBS bank in Hong Kong is willing to make such settlement proposal, I do not see why DBS bank in homeland Singapore should not make the same settlement proposal!

The unwillingness of banks and authority in Singapore to work for a universal settlement maybe due to the fact that Minibond victims in Singapore have not applied enough pressure on both the banks and MAS.

Goh Meng Seng

Why Hong Kong?

By now, readers of my blog will find it strange that I have put up quite a lot of information on Hong Kong's democratic movement.

I shall explain it next week after I have time to put up more information on the 1 July protest march.

Goh Meng Seng

Hong Kong Minibond Victims 7.1 Protest

Demanding resignation of Chief Executive Donald Tsang

The Hong Kong Minibond Victims Alliance has organized its first largest protest march since last October today. It is basically very well organized with bamboo stick placards all prepared in advance and all supporters mobilized to take part in its first ever 7.1 protest.

The main theme of the protest is to demand the resignation of the Hong Kong Chief Executive Donald Tsang for not able to settle the Minibond saga after so many months of fact finding and investigation.





DBS is naturally one of the main bank the protesters have targeted. There are total of 16 main banks that were involved in the selling of the toxic structured financial products and recently they have made proposals to the Hong Kong Monetary Authority for partial settlement of Minibond investors.

Apparently they are more aggressive in verbal demand



The Alliance has claimed that the mis-selling of minibond should be considered as a case by case basis because it is basically a systematic problem in the marketing of such toxic financial products.

The Alliance has pointed out that the fact finding from the Legislative Council has shown that there are evidences of systematic failure of regulative oversight as well as the internal controls within the banks' marketing protocols.

The Leader of the Alliance addressing the crowd

I estimated the size of the crowd to be about 8,000 to 10,000. Many of the protesters are elderly and fragile victims who have lost their entire savings. In spite of advice from organizers to ask their family members to come as representatives due to the expected hot summer weather, they have insisted to participated in the protest personally.





The protest march created a small commotion on their way to the government house. Some of the protesters deviated from the planned route to the HQ of Bank of China to demonstrate against the bank. Otherwise, the protest is generally peaceful, orderly and very well organized.





This protest is separated from the main 7.1 protest and it is carried ahead of the main 7.1 protest march. Although they lack manpower and funding in setting up big sound system, but generally speaking, in terms of cohesion and preparations, they are better off as a small and highly motivated group of people.

All the best to them.

Goh Meng Seng

Democratic Progress in Hong Kong Part 1 - 6.4 Protest

I have originally wanted to write about June 4 2009 candle light protest in early June but unfortunately due to heavy work commitment and time constrains, I have to postpone it till now.

I shall do a series of write up of June 4 and July 1 protest march along with my thoughts on the democratic progress that Hong Kongers have achieved since 1997's handover of the ex-British Queen Colony to China.



4 June 1989 is a sad day for China as well as Hong Kong. It was even a fearful day for Hong Kong which was anticipating the eventual return to China's sovereign control in 1997. Many Hong Kongers have decided back then to plan for their eventual departure from their homeland for fear of the communist iron fist rule.




The massacred of Tianan Men protesters, who were mainly young students, has casted a terrible shadow of fear on Hong Kongers. From then on, there was a consistent outflow of Hong Kongers to all over the world, including Singapore, which eventually created the exodus all the way till 1997 which Hong Kong has not experienced before.

Amidst the fear of the Communist rule, the first candle light memorial service for the 1989 Tianan Men massacred was held in 4 June 1990. It was reported that tens of thousands of Hong Kongers attended the event and from then on, Hong Kong democratic and human right fighters have continued to organize such event annual for the next 20 years.

Photo from Hong Kong Apple Daily

I have attended a few of such gathering in the past but this 20th anniversary memorial service is the biggest ever gathering I have seen so far. I estimated about 170 thousand people attended the event.

I was just a teenager when the massacred happened back then. My tears were rolling when I read about students being killed and how soldiers fired upon students and civilians who were totally unarmed. It was a sheer political awakening for me on how an authoritarian government with unchecked power could do to its own people. It is a mindless massacred just for the sake of power.

These students stood up against corruptions of that their country faced back then and demanded accountability of the government via democratic changes. It was out of pure patriotism that they took on to the street to demand change to the political system. But their demand was met with cold blooded massacred.

These students might be over zealous in asking for democracy but in my view, the massacred is totally unnecessary. There were advance anti-riot gears and tools to handle such demonstration and protests. To use guns to attack their own citizens who were just civilians is totally unacceptable. Guns, tanks and military machineries are supposed to be used on criminals and for defending the country against external invasion, not on civilians.



Besides, to me, these students are patriots, not traitors nor trouble makers. They are people who are concerned of their country's future. And I think it is about time that the Chinese Communist Party should put this part of the history right and admit their past mistakes in handling these protesters.



Unfortunately, some of the Pro-CCP people have asserted that there were no bloodshed, no massacred when army troops drove in Tianan Men. These blatant lies were told despite of the many evidence shown in various newspaper reports on the event.

The worse thing to happen is that the Chinese government has tried to blackout all news with regards to the 4 June event. Many forums and websites which are critical about the Chinese government were shut down. This reflects very badly on China especially so when it claims that it wants Shanghai to develop into an international financial center by 2020.



It is impossible to convince international investors to invest in Chinese listed companies or have any confidence in the whole system when the government itself could carry out such massive blackout of news and information over anything it deems undesirable!

The primary fundamental pillar of any international financial centers in the world is freedom of information flow. It is amazing that the Chinese government has done something so damaging to its future development plan without even knowing it! Distortion of information or total blackout of information is something intolerable for any world class financial centers.

China will have a long way to go to become the international financial center that it so desired if it carries on having such mindset over information control.







I am very impressed by Hong Konger who are well known for their very calculative mindset when it comes to business dealings. Part of the reason for such large turnout this year was due to the Chief Executive Donald Tsang's assertion that China has made great economic progress since 1989 and his view represented most Hong Kongers. What he meant explicitly was that Hong Kong have benefited from China's economic progress since 1989 and most Hong Kongers would not be bothered about what happened in 1989.

On the other hand, Hong Kong government has denied entry for few democratic activists which include those student leaders of the 1989 Tianan Men protest.







His view and his government's denial of entry for these people has angered many Hong Kongers who are usually more concerned about their livelihood than political events like this one. Many Hong Kongers participated in this candle light memorial service just to make a point to Donald Tsang that they do care about democratic development for the whole China, including Hong Kong, despite of enjoying economic concessions from the Chinese government.

They do not wish such draconian massacred to happen again in China, least Hong Kong, for any reason at all. Even economic development is not a good reason for such cold blooded massacred and human right violations.




More importantly, all these happenings had reminded Hong Kongers the importance of passing on the baton of democratic fighters to the younger generation. One of the main theme of the 20th anniversary gathering is passing on the memories of truth happening of 1989 Tianan Men massacred to the younger generation.

It is a thought provoking sight to witness young secondary school students taking their own initiative to participate in this gathering. And they demanded the truth to be taught in their history book instead of hiding the crucial fact of such massacred from them and the future generations.



I think Hong Kongers will continue to fight and push for more democratic progress, not only in Hong Kong itself, but for the whole China. It may become the important base for democratic fighters in China to push for their agenda in the years to come.

On the other hand, I believe that China should stop its desperate move on information control. It has issued a law to make it mandatory for PC makers in China to install a censorship program but met with strong resistance from the Chinese internet community, as well as PC makers.

The process of democratic liberation is inevitable when the market economy is to be further enhanced. If Chinese companies are to grow into bigger MNCs, they would need foreign funding and this could only be done with an assurance of transparency by means of free information flow.

Hong Kong may well continue to play an important role in pushing the boundaries of democratic development in the whole China. It would be interesting to see how things turn out in the next decade or so.

Goh Meng Seng