Progress of the HKMA's investigations in Lehman-Brothers-related cases

Press Releases

19 Mar 2010

Progress of the HKMA's investigations in Lehman-Brothers-related cases

The Hong Kong Monetary Authority (HKMA) announced today (Friday) that up to 18 March 2010, there were 13,033 complaint cases concerning Lehman-Brothers-related investment products which have been resolved by a settlement agreement reached under section 201 of the Securities and Futures Ordinance (Notes 1 & 2) and 1,473 cases through the enhanced complaint-handling procedures required by the settlement agreement. Together with the 2,928 cases closed because insufficient prima facie evidence of misconduct was found after assessment or no sufficient grounds and evidence were found after investigation, the handling of 17,434 complaints received have now been completed.

Currently, 1,056 Lehman-Brothers-related complaint cases (including minibond cases) are under disciplinary consideration after detailed investigation by the HKMA. Proposed disciplinary notices are being prepared in respect of 757 such cases and proposed disciplinary notices or decision notices have been issued in respect of the other 299 cases (Note 3). Another 2,281 cases are pending decision (Note 4). Adding these 3,337 cases to those the handling of which has already been completed, investigation work has finished for 96% of complaint cases received.

(A table summarising the progress of the disciplinary and complaint-resolution work in respect of Lehman-Brothers-related complaints is attached (Note 5).)


For further enquiries, please contact:
Peggy Lo, Manager (Communications), at 2878 1687 or
Yokee Wong, Manager (Communications), at 2878 1213

Hong Kong Monetary Authority
19 March 2010



  1. On 22 July 2009, the SFC, the HKMA and 16 distributing banks reached an agreement under section 201 of the SFO in relation to the repurchase of Lehman Brothers Minibonds from eligible customers and the HKMA has informed the banks that, since the agreement contains detailed arrangements for settlement of claims and the implementation of robust systems for selling unlisted structured investment products and dealing with related customer complaints in future, it is not the intention of the HKMA to take any enforcement action in relation to Minibond cases that involve eligible customers who accept the repurchase offer.
  2. Since 7 August 2009, 16 minibond distributing banks have begun issuing repurchase offer letters to eligible customers (about 25,000 customers) under the Lehman-Brothers Minibonds Repurchase Scheme (the Scheme) announced on 22 July 2009. Up to 15 March 2010, 24,749 customers have responded to the repurchase offers, of whom 24,488 customers or 98.9% have accepted the offers. As of 15 March 2010, for customers who had accepted the offer, 99.99% of them already received payment from the banks concerned, while the remaining payments will be settled soon (in any case no later than 30 days after having received the duly completed acceptance forms from these customers). Separately, about 4,800 customers who had reached settlements with the banks prior to the introduction of the Scheme are eligible for the voluntary offer made by the banks, with a view to bringing them in line with the eligible customers who accept the repurchase offer under the Scheme. For customers whose previous settlement amount was less than 60% (for customers aged below 65) or 70% (for customers aged 65 or above) of the principal invested, 99.5% had already received top-up payments from the banks concerned on 27 February 2010.
  3. These are cases in respect of which (a) proposed disciplinary notices have been issued and representations were pending, (b) representations have been received and are being reviewed, or (c) disciplinary decision notices have been issued and the persons concerned have been given 21 days to consider whether to appeal to the Securities and Futures Appeals Tribunal.
  4. These are cases in respect of which investigation work has been completed and are going through the decision process to decide whether there are sufficient grounds for disciplinary actions or whether the cases should be closed because of insufficient evidence.
  5. Some figures in the table have been adjusted after re-grouping of certain complaints involving multiple products and elimination of duplicated complaints.
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Last revision date : 19 March 2010