Martin Lee @ Sg
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Oei Hong Leong Sues Citigroup

In a landmark case, Oei Hong Leong, the man with the Midas touch, is suing Citigroup for negligence and mispresentation over his loss of $1 billion (!) due to trades in foreign exchange and US Treasury bonds.

Oei Hong Leong claimed that Citigroup gave him inaccurate and inconsistent reports on his trading positions, leading him to take on bigger positions than he would have done.

When he realised the extent of his positions, he had no choice but to close all of them during a very volatile time in October last year.

While Mr Oei had correctly predicted the economic downturn as early back as 2007, it seems he has been badly caught on the wrong side of foreign currencies.

It is unclear how much of a dent the $1 billion loss would have made on his net worth. Mr Oei commented that he had planned last year to set aside $1 billion for charity. That plan has now obviously been delayed.

Now we also know that Forbes’s estimate of US$210 for Oei Hong Leong’s networth last year is way off the mark.

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6 comments
Roger says 10 years ago

Thanks Lion for your feedback.

No, I did not bother to contact Fidrec as the last time when I tried to regarding insurance issues I get the feeling that they are also not too keen to take up the issues. Anyway I have come to accept the service standards here and adjust my expectations accordingly. With banks I just try to do business with those that are more proactive but with SGX being a monopoly I just overlook it as it is just not good for my health and my sanity if I were to pursue it. Someday, someone with deep pockets facing the same nonsense will take action.

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Hindsight says 10 years ago

The moral of the story is don’t trust financial institutions, in particularly those RMs who are out to make a dime out of you rather than to render any services. Any services rendered are just auxiallary to their objective of making money out of you.

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Roger says 10 years ago

The issue here is one of misinformation. I faced it too with various agencies, even with POEMs. Banks with their RMs also have this problem, though I am surprised that such a wealthy customer like Oei should be getting the extra attention. My RMs constantly are not able to give uptodate information as well. Even my insurance agent also appear muddle headed and not proactive and I have to call her up repeatedly to correct any mistakes.
These organisations are very good at disclaiming liabilities. For example, when I constantly received wrong information, after extensive checking and told my broker about it, the information never get updated and the next month statement still wrong, the only change is that now they make me agree not to make them liable for any mistake, in order words, cannot sue for any losses due to their mistakes.
The same with the banks, if Mr Oei has signed such an undertaking then his lawsuit will fail, but that does not mean that there is no grieviance.
Investors primary responsibility is to come out with the money to invest and make decisions on what to invest and the timing. The banks, brokerages or even SGX responsibility is to ensure those instructions get carried out promptly and if not, communicate problems promptly for investors to make the decisions, based on accurate information flow. Very often, however, when an execution fails, no communication and even misinformation is provided upon request.
I personally experienced a trade not executed and when I try to contra found that the buy trade was not executed. My broker and SGX both blamed each other when I called them up respectively. Later it was my broker’s word that SGX system failed but no management from SGX takes my call. Only the frontline girl at first denied responsibility. When I told her that my broker has evidence, SGX did not call back and just ignore my calls. Attempts to reach the CEO also failed.
I am not like Mr Oei who has deep pockets to sue but it is high time that executives in these financial organisations get off their high horses and treat their customers decently instead of just getting their money and ignoring their needs for timely and accurate information in order to make good decisions for both their own and their finanical institutions’ future.

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Kenneth says 10 years ago

Trading is Forex or derivatives have always been in the news due to big losses. Law suits were filed with customers pointing at banks for causing their losses. SembCorp Marine, CAO and some other big blue chip also fell into this trap.

I am very surprise that Ooi has the same problem. My impression is that he and his ‘A’ team of managers are on top of the game with success story like NatSteel, AIG crush etc.

Well, looks like he is just as normal as us. Burnt by the market….

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    lioninvestor says 10 years ago

    Hi Kenneth,

    As we can see, even professionals can get it wrong.

    We should be wary of anyone who tells us that forex trading is easy.

    Reply
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