Lehman losers vow to fight on
Ada Lee and Tony Cheung
For years, they banged the drum for justice, noisily protesting outside banks as they sought the return of money lost on minibonds when Lehman Brothers went to the wall in 2008.
Whereas once there were dozens of investors banging drums and hanging banners, now just a handful continue their daily protests outside banks in Central - and while they are determined to fight on, they know all too well that their bargaining power is diminishing.
While 35,000 of the 43,000 Hongkongers who bought Lehman-linked minibonds have long since been compensated between 60 per cent and 97.5 per cent for their losses, at least 2,500 had not received a cent by the time a Legislative Council subcommittee released its report on the affair yesterday. The outcome for investors who didn't settle or complain to regulators is unknown.
Compensation deals excluded those defined as professional or experienced investors.
'Victims who persist in protesting have become more isolated. There's a concern that our bargaining power is decreasing,' said Peter Chan Kwong-yue, former chairman of the Alliance of Lehman Brothers' Victims. 'But the report will not signify the end of our fight for justice. We will continue to see what we can do.'
Chan said many of those who joined the protests chose to accept compensation, while others could no longer take the stress. There were also elderly investors who physically struggled to make it to protests.
The group did manage to muster about 100 protesters outside the Legco building for the release of the report, which said Hong Kong's 'ineffective' financial regulatory structure was at the root of the problems leading to the crisis.
The protesters accused the government of dragging its feet and called on Financial Secretary John Tsang Chun-wah and Secretary for Financial Services and the Treasury Professor Chan Ka-keung to quit.
Chan was pleased with the turnout, but said the number of active protesters was 80 to 90 per cent down on its peak. And he had little hope of progress from the lawmakers' report, although the group may seek a judicial review of the decision not to compensate professional investors.
Protesters cite the fact that 11 of the 27 lawmakers who served on the committee dropped out as a sign of the declining interest in their plight.
'Our bargaining power has basically all gone with the many lawmakers who left the subcommittee,' said Philip Khan, who served as deputy chairman of the alliance. 'Hongkongers are very forgetful, and the issues surrounding Lehman Brothers will be forgotten very soon.'
Chan added: 'We now only hope the public could be more sympathetic towards those who persist.'
Khan said yesterday's report did not set out the mistakes made by each of the banks that sold minibonds - high-risk, credit-linked derivatives that were marketed as a proxy investment in well-known companies. It would therefore not increase the bargaining power of those who lost out, or help the class-action lawsuit they are bringing against HSBC in the United States.
An attempt to challenge the decision of the Monetary Authority and Securities and Futures Commission to end their investigations after banks settled with the majority of investors was rejected by the High Court in 2010.
But legal setbacks, Legco reports and years of disappointment haven't yet deterred Li Hon-ming, 48, one of two investors who still regularly protest outside Citibank in Central. They once numbered 30. 'I must persist,' he said. 'I got nothing from the settlements because I was categorised as an 'experienced investor', having bought the product seven times in three years.'
Li invested US$800,000 in Citibank's Lehman-linked notes for his mother, who is in her 80s. He bought them in January 2008, eight months before the firm collapsed. He tried to charge into the Charter House yesterday as the group waited for Securities and Futures Commission representatives to take letters of protest they had sent. 'I quit my job to fight for justice,' he said, adding that he was living off savings. 'There's not much left. I will do what I can.'