I had a personal experience with the DBS Relationships Managers (RMs) a few years back when I was utilizing their counter services at the then Raffles City branch (which had since closed). I was ushered to one of the cubicles of the RM and he started telling me about investing my money. At that time, the market was bad, and he was introducing a product that works for that; meaning, when the market goes down, I earn.

I didn’t know what that was, and even if it was shorting the market, I didn’t know there can also be a product for it. Nonetheless, after a while, I decided not to invest because he was asking for tens of thousands to invest, which I obviously didn’t have.

Since then, my mum had also been asked by the RM to invest recently. However, I have no idea what she invested in and I have not spoken to her for a long time. She might have been burned for all I know, but when I first knew about her investment, I was quite furious because she has totally no idea what she’s investing in and it’s not her fault. The RM simply told her that it’s a form of investment with GUARANTEED returns. Oh come on, there’s NO SUCH THING as a GUARANTEED RETURN!

If you are guaranteeing 0.3% p.a. or something along that line, yes, I might buy it; but 5% p.a.? Even my AIA financial advisor didn’t dare to guarantee such a return for me. Then again, if he did, I would probably switch my financial advisor right away. Speaking about that, it’s probably a fact that the RMs disappear from the banks faster than the Starbucks barista can make an iced lemon tea. The next time my mum went back to the bank to ask them about her investment, the RM who attended to her was no longer there, and her balance in her port folio was near zero. Where’s the integrity?

However, as the saying goes, a fool and his money are soon parted. I would not call the investors fools, however, I would say that the RMs made fools out of them by not informing them of the risks that are involved in investments. In fact, Maybank also advertised a fixed deposit of about 3.8% returns during the last Comex Show. Upon further inquiry, I found out that there is no fixed deposit as per se, but rather, an investment plan by another insurance company. Integrity? Presenting facts? I only see false selling.

I do not feel angry about my mum’s loss. In fact, she’s still investing her money monthly because of what the first RM told her – that eventually, the money will “grow back”. See? A fool and his money are soon parted. A bigger fool and all his money is owned by the bank (editor: I am so tempted to write this: A fool and his money is all belongs to the banks [sic]). I foresee that 10 years down the road, my mum will still have zero in her investment port folio because the RMs at the POSB/DBS bank are not doing their job. They are treating all their customers like fools. I don’t think they have contacted her since she invested – and  paper statements do not count because she can’t make her own decisions based on whatever’s written in there!

So, as for the DBS debacle, the RMs have definitely made fools out of the investors, and it’s unlikely that any sound organization will step in to intervene. Investment – regardless of whether the investor knows about it – has its own risk. One might think that I am being heartless – but can you imagine how things will be if, say, the MAS insists that DBS refund the investors their money?

“Gain, I keep; loss you pay”?

I don’t think the investors, especially the elderly ones deserved what they got. However, if a government financial institution steps in to demand for compensation, I think it sets a precedence which will not be good for anyone. The next time some investors lose some money, the same thing might happen again and they may demand for compensation for apparent ignorance.

The people in Hong Kong are not getting it any better too, even as the banks buy back at market rate. Come on, how much are the bonds worth now anyway? Singapore, at best, might go down this road, but it’s no consolation to anyone. As for responsibility, the RMs might eventually be blamed for this – but they may no longer be around to “bear the responsibility”.

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