Fears over 'no-risk' scheme

REGULATORS have urged investors to be cautious about an unauthorised investment company offering 'guaranteed' returns of up to 15 per cent - nearly three times the best rate on offer from the territory's leading banks.

The British-based company has been advertising in Hong Kong newspapers and its principal, Jonathan Kendrick, was last week photographed in a Central hotel attempting to sell the product to a reporter posing as a prospective client.

Mr Kendrick, whose office is based in Bridgnorth, England, spent the week at the Mandarin Oriental meeting potential investors, who were being asked to pay a minimum of US$100,000 for a stake in the scheme.

His company, Aon International, describes itself as offering 'high-profit investments' but is not authorised with either Hong Kong's Securities and Futures Commission or its British equivalent, the Securities and Investments Board.

The company, which is registered in the Cayman Islands, is not in any way connected with Aon Holdings Asia, a local investment advisory group; Aon Insurance, the brokerage; or Aeon Credit Service (Asia), the money lender. The British firm promises quarterly payments of up to 15 per cent - nearly three times the 5.75 per cent rate on offer from Hongkong Bank for a 12-month time deposit of $100,000.

Mr Kendrick said 15 per cent was a minimum and he could 'almost certainly' pay 18 per cent.

But Deborah Glass, the futures commission's senior director of investment products, said: 'There are some things that should trigger alarm bells for an investor. One of these is a guarantee in excess of current interest rates, and another is any form of advertisement that is long on promises and short on detail.' Ms Glass said Aon's advertisement was not authorised by Hong Kong's financial authorities.