Second BOC officer on minibond charges
A Bank of China manager faced the District Court yesterday accused of misrepresenting Lehman Brothers minibonds to customers - two weeks after colleague Cheung Kwai-kwai was acquitted of similar charges.
Tai Ching, 39, a senior personal financial services manager at BOC's Taikoo Shing branch, is accused of fraudulently or recklessly inducing two customers to invest more than HK$1.3 million in Minibonds Series 35 in January and February 2008.
She pleaded not guilty to two charges under the Securities and Futures Ordinance. The prosecution dropped a third charge, offering no evidence.
Prosecutor Neil Mitchell said Tai persuaded Wong Sau-ching and Ho Kit-sum into signing up for HK$320,000 and HK$1 million worth of minibonds by saying they were 'very secure' or 'very safe', statements the prosecution said Tai knew were false.
Tai also told them, knowing it to be untrue, that the product was linked to seven entities: HSBC Bank, Hutchison Whampoa, MTR Corporation, the People's Republic of China, Standard Chartered Bank, Sun Hung Kai Properties and Swire Pacific, Mitchell said. Tai (pictured) never mentioned that the minibond was related to Lehman Brothers.
The court also heard that Tai told Wong, 57, a housewife with a secondary school education, that if one of the entities ran into trouble, the bondholders would only lose the portion corresponding to that entity and that it was 'impossible for all entities to suffer a credit event'.
On the same day, the court heard, Wong was asked to sign a questionnaire in which she was classified as a 'moderate aggressive' investor, although she only wanted to be involved in low-risk investments.
Ho, 69, a retiree with primary school education, was approached by Tai when his fixed deposit matured in February 2008. He later bought HK$1 million worth of minibonds after Tai told him he could earn more interest and the product was safe.
The court was told Tai admitted to Wong that she misled her in making the investment when Wong confronted her following the collapse of Lehman Brothers in September 2008.
The trial continues.