Martin Lee @ Sg
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Filing of Minibond Claim With US Trustee

Last week, SIAS organised a seminar to provide information on the filing of claims with Lehman Brothers Inc.

Lehman Brothers is in liquidation in the US and all creditors must lodge their claims with the US trustee, James W. Giddens, appointed under the Securities Investor Protection Act of 1970, as amended (“SIPA”) on or before 1 June 2009.

SIAS has a statement written in bold and capital letters on their website saying they cannot provide any advice as to whether a claim should be filed and how to go about it. However, they just published a FAQ today with more information for Minibond holders.

At about the same time when this first surfaced, MAS issued a statement saying that the two Lehman Brothers entities incorporated in Singapore, Lehman Brothers Pte Ltd (LBPL) and Lehman Brothers Singapore Pte Ltd (LBSPL), hold a few hundred million in assets here. Similarly like SIAS, MAS is unable to provide any legal advice to investors on whether they should file a claim.

HSBC Institutional Trust Services has also updated their FAQ today with more information on this claiming process. They have also sent out a letter to affected Minibond holders. Inside the letter, they stated that they will not be filing a claim as they are not in a position to do so. The softcopy of this letter can be downloaded here : Lehman Liquidation Claim Notice from HSBC

The website for filing a claim can be found here:

Lehman Trustee

The process can be done electronically and the general claim form (not the SIPC form) should be used.

I’m afraid the whole thing is going to make everyone even more confused. Basically, SIAS, MAS and HSCB are telling you to consult your own lawyer on what to do next.

Unfortunately, I’m not legally trained and am unable to provide any proper advice on this. Hope to generate some useful discussion here.

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23 comments
David says 10 years ago

I just received an offer 25% of 180,000(series 9) by HL. I am at lost to take up the offer or goes to FIDREC court.

I hope someone advice.

Thanks
Help.

Reply
    lioninvestor says 10 years ago

    Hi David,

    Hard for anyone to comment without knowing the specifics of your case.

    How were you sold the product? Was there misrepresentation? Was there any documentation?

    With FIDRec, you might only be able to limit your claim to $50k unless the FI allows. Which is already close to what they are offering now.

    Reply
trymyluck says 10 years ago

Dear lioninvestor

I filed my claim online yesterday to
SIPC for the remaining 40,000 Minibond notes (10,000 had been bought over by my FI) and immediately got a return acknowlegement. So, what next?

trymyluck

Reply
    lioninvestor says 10 years ago

    Hi trymyluck,

    Other than wait for things to be resolved, I think there isn’t much we can do at this moment.

    Reply
Kathy says 10 years ago

I agree with “Puzzled”. We are the victims of a “theft”, and are left with no recourse, except to file with FIDREC. However, if any one is willing to champion a combined effort to take a legal case against the financial instititions, I would be willing to join in. Unity is strength.

Reply
    lioninvestor says 10 years ago

    Hi Kathy,

    There are a couple of legal groups being organised. Here is one of them:

    http://www.miagsg.com/

    Reply
sureesh says 10 years ago

Is it too late to make a complaint of misselling to the bank. I bought it from maybank

After all the claims process seems so complicated and we may not get a satisfactory outcome from the claims. And even HSBC does not seem to want to do anything

Reply
    lioninvestor says 10 years ago

    Hi Sureesh,

    I think better late than never.

    Reply
Puzzled says 10 years ago

Has anyone completed the filing against LBI? After attempting to file, I’m beginning to think this is not meant for Minibond customers. None of the claim categories seems to fit the Minibonds.

Item 1 is to be completed if LBI owed us cash, which is not true for the Minibonds case.

Item 2 deals with securities (including any options) held by LBI for us, which is also not true since our Minibonds securities are held by Singapore CDP.

Item 3 should only be completed if we have a claim based on a commodity futures account at LBI.

We didn’t even buy the Minibonds from LBI. We bought the Minibonds from our “friendly neighborhood” local banks and stock brokerages. So how to make a claim against LBI?

Anyone has comments on this before the 1st June deadline?

Reply
    lioninvestor says 10 years ago

    Hi Puzzled,

    The claim form you used is for Lehman’s brokerage customers.

    There’s another one for general creditors.

    Reply
Michael Lim says 10 years ago

I understand minibonds are held by CDP. In the eye of the US court, CDP is viewed as the owner of the minibond.

I wonder if CDP is able to comment if it is taking any action for the minibond holders.

Reply
    lioninvestor says 10 years ago

    Actually,

    I thought HSBC trust should be the ones filing (if there is any merits to it).

    After all, they are the ones who are supposed to be holding on to the assets.

    Reply
Hopeful says 10 years ago

Hi Lion Investor

What would the implications be for a Minibond investor who does not file a claim with the US Trustee nor take part in the legal action now? Would it be all lost to the investor ie do not hope to get anything back in the future?

Many thanks

Reply
    lioninvestor says 10 years ago

    Hi Hopeful,

    Assuming none of this was done

    1) file dispute to FI
    2) Complain to FIDREC
    3) Legal action
    4) File with US trustee

    the investor will just have to wait a couple of years for all legal issues to be settled before getting back the remaining value of the underlying assets of the minibond (value unknown).

    Reply
      Confused says 10 years ago

      my mom holds 20 K in minibonds series 5. She settled with the Maybank ( they bought 5K from her). Now we are thinking of filing the remaining 15K with the US trustee? Do u know if she is a creditor or customer? There seems to be different forms for these. These filing procedures are so confusing. Why isn’t any organisation helping out with advice for claims? Any advice will be greatly appreciated.
      Thank you.

      Regards,

      Reply
        lioninvestor says 10 years ago

        Hi Confused,

        The customer form is more for people who have brokerage accounts with Lehman.

        The general creditor form is the one we should use (IF we are filing).

        Basically, no one wants to give any advice as they are afraid of liability. Sad but true.

        Imagine putting up a public statement, hundreds of people act on it, the information turns out to be incorrect and all of them start suing you.

        Reply
Beh Song says 10 years ago

Received the letter from HSBC Institutional Trust Services (Singapore) Limited (HTSG) regarding updates on MiniBonds. They’re even scared to use their proper letter-head in sending out this letter. Content-wise, an almost replica of what’s on their webpage. To summarise their message :

1) HTSG as Note Trustee is “responsible for enforcing the rights of Noteholders..in event of default…) but cannot do anything to help you as investor for now. What they have done is to appoint PwC as Receivers….and whether we can be compensated depends on them

2) For more updates, pse look at http://www.lehmantrustee.com (as they do not know anything nor can do anything)

3) In short, HTSG cannot provide any new information which we do not already know nor facilitate any action, legal or otherwise.

I would rather that they pay me the postage for sending me this letter instead.

Reply
Beh Song says 10 years ago

Agree Fully with Puzzled. HSBC Trustee just hide in a corner and disclaim that they cannot do anything which is “crab”. They take a cut from us in good times and leave us to fence for ourselves in bad times. Understand that MiniBond investors in Hong Kong are suing HSBC. Maybe we need a collective action here as well. Lehman Brothers are already bankrupt and I believe that there are many secured creditors ahead of us, so it’ll be very difficult to be compensated. But HSBC is still around.
Also need to add that the FI who sold us the product should also be liable, since they’re the party who marketed it to us.

Reply
Very Sian says 10 years ago

How to file our own claim? We are small, tiny investors in front of a giant and cannot afford the legal fee. May be the eventual compensation alone may not be able to cover the legal fee.
What is our government or MAS doing, let us be bullied by the big FIs???

Reply
east_europe_fraud says 10 years ago

This probably not much help to investors who lost their money…but these people who came up with structured products have millions of dollars to hire lawyers. Purpose is to work around the law and make money, not to do what’s morally right. Doing what’s right depends on gut feel, not spending millions on lawyers…

Rarely can the retail investor beat firms with legions of lawyers.

Reply
MiniBomb says 10 years ago

Totally agree with Puzzled. What can we do as individual. It should be the Trustee role to file a claim on behalf of all investors. MAS should enforce this but very disappointed that they did nothing till now ……

Reply
Puzzled says 10 years ago

I’m beginning to wonder about the role of the Trustee. I thought the Trustee should be able to handle all such issues on behalf of everyone, including those not-so-educated buyers who did not manage to get compensation from their banks. If we have to file everything on our own, why do we need this Trustee? At the end of the day when we do get back some money, why should we bother to pay a certain percentage to the Trustee since they have done nothing thus far?

I think the MAS should come out to advise whether we should file a claim. We don’t want to file a claim and end up with some unwanted complications. Neither do we not want to file a claim and lose out on any compensations. Not everyone can afford to pay their lawyers for such advice. The MAS (for allowing such products to be sold in Singapore in the first place) and the banks selling such products should collectively advise or help make the claims on behalf of their affected clients. Why should we be left to fend for ourselves, with MAS and the banks simply claiming that they can’t provide any advice?

Reply
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