Last Updated on 26, December 2016
Financial Industry Disputes Resolution Centre Ltd or FiDREC for short has reported an increase in complains against financial institutions. Complains against banks were up by a whopping 48%; for life insurers, the complains were up by 31%. Complains against licensed financial advisory firms and insurance intermediaries was down slightly by 5%.
Source: FiDREC annual report 2015/2016 and FiDREC annual report 2014/2015.
In this article, I will briefly provide a few tips on how to avoid becoming a victim.
Understand whom you are dealing with
If you are dealing with a life insurance agent, you have to understand that by the law of agency, insurance agents are legally bound to put their agency first. The insurance ‘agent’ is not your agent, he or she is the agent of the agency. You do not have any agent in this case.
A property agent represents you as the buyer (if you are purchasing) or you as the seller (if you are selling). This is the reason why property agents are not allowed to represent both buyer and seller due to conflict of interest.
The insurance agent is always representing the seller. In this case, the life insurance companies are trying to sell insurance policies to you. That is why, they are not allow to represent both the buyer and seller due to the same conflict of interest.
If you are dealing with a relationship manager (RM) of a bank, the RM is an employee of the bank. The employee has the duty to put his or her employer first. Again, you do not have an RM. It is not possible for the RM to represents you because you are not the employer of the RM.
Understand the statutory Requirement
There are statutory requirements under the Financial Advisers Act in which the insurance agent and relationship manager must fulfill in order to protect the client from harm.
These are like the requirement to fact find, conduct risk profile and recommend suitable products to the client. There is also a Balance Scorecard in which the insurance agent/relationship manager’s salary will be confiscated if the products recommended are not suitable. But you must understand that the statutory requirements constructed are very easy to fulfill – you just need to sign the countless blank forms. These blank forms are then fill up after you purchase the product so as to satisfy the compliance department.
I strongly advice you never to sign blank forms. Ask the agent / RM to show you exactly why the products recommended is suitable. If the emphasis is on the features of the product, you can be sure that the agent/RM does not know how to ensure the product is suitable.
Imagine a doctor who keeps on telling you the benefits of open heart surgery but fail the explain why he thinks you are suffering from a heart disease. Such a doctor is ‘pushing’ products without explaining why the procedure is suitable.
Understand the importance of after-sales
The financial industry is highly transactional. This means they place a lot of importance of making the sale but little effort in the after-sales service. The after-sales service is seen as a cost-center while the initial sale is the profit-center. Obviously this is not what you want. So it is important to find out how the after-sales service is. While the insurance agent / financial adviser plays a big role in the after-sales service, the financial institutions also play a significant role. For example, if the insurer outsource its call center to a country which cannot even understand English, you can be sure that the after-sales service is as good as none.
Even though pre-emptive measures have been put in place by the Monetary Authority of Singapore (MAS) over the last few years to improve financial services, we have yet to see encouraging results. The primary role of financial advisers is to assist clients by giving professional advice. From the many grievances received, advisers were found to be engaging in the "selling" mode rather than the "advising" mode. This goes to show that professionalism is seriously lacking among some advisers. This is a grave concern. 
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In Singapore, the BIG INSTITUTIONS are very well “protected” against the Ikan Bilis.
i have been one of the victim after using ESA at ATM (the recent KEPPELDCREITNRO) for more then “donkey years”.
i HAVE YET TO USE FiDREC.
AND i will be charged about $53 if FiDREC take up my case.
Beware FiDREC is just like case, “NATO”
i think FiDREC also can not enforce anything.
Fidrec initial mediation is FOC. But if mediation is unsuccessful then adjudication costs $53.50 (incl. GST) for the individual complainant.
Fidrec is funded by FIs (banks, insurers, FAs, fund companies, etc) and by 10,000 years of human civilization of empirical evidence, the music is determined by whoever pays the piper, irrespective of nicely or legally or officially stated in black & white, or having independent board. Afterall if not enough FIs bother to be members & pay their levies, then Fidrec will cease to be able to operate on an ongoing economic basis.
http://www.mas.gov.sg/~/media/resource/publications/consult_papers/2004/Public_Consultation_Paper_FIDReC.pdf
Do note that member FIs are incentivized to quickly close cases & to avoid protracted fighting that will incur additional costs e.g. billable adjudicating hours. FIs that have a lot of complaint cases or more “complicated” prolonged cases will have to pay higher levies.
If FiDREC can not redress for me, is there a possibility of using my own lawyer?
Assuming the redress is worthy enough (aka in terms of recovering monetary loss by me).
Hi Tony Tan,
Before you try to seek any redress, you need to be able to explain what was the problem in clear simple English. Based on your 1st comment, its impossible for anyone to understand what was your problem. Avoid abbreviations and avoid using singlish as not everybody can understand such language.
O. K.
Actually the amount of monetary loss by me is not large enough to consider using my own lawyer.
That’s why FIDReC existed i supposed
Now i a repost what i have posted actually in this BLOG just for everybody benefit.
///////////////////
ATM’S ESA “SOFTWARE BUGS OR ???”
DEAR VALUEBUDDIES,
i AM RE-POSTING THIS HERE SO THAT ALL OMPIs WILL TAKE NOTE AND BEWARE!!!!!
i HOPE CW DOESN’T MIND.
MY APOLOGY IF HE DOES.
///RE-POST
2 comments:
1.
Createwealth888824 November 2016 at 09:00:00 GMT+8
Craziness in the stock market is unpredictable and reaction is unmeasurable
2.
temperament24 November 2016 at 10:40:00 GMT+8
But then that is the beauty of the market.
That means we are all crazy at one time or another.
Sure, you are always sober!
i Don’t think so?
i am crazy at times.
i still do at my age.
Maybe you can suspect i am beginning to have DEMENTIA.
i SUSPECT YOU TOO.
Ha! Ha!
// // i give a real example.
And i hope all ATM’S ESA applicants take note.
On 31/10/2016; 09:10
LOCATION: BEDOK RES/123B
FROM 090XXXXX4-0 TO KEPPELDCREITNRO
SERVICE CHARGE: $2.
THE ABOVE INFOMATION TELLS YOU CLEARLY MY ATM’S APPLICATION FOR KEPPELDCREITNRO.
AS i HAVE BEEN DOING ESA AT ATM FOR “DONKEY’S” YEARS, I KNOW WHAT TO EXPECT ABOUT THE WHOLE ATM PROCESS.
i WILL BRING A PIECE OF PAPER WITH DETAILS OF MY CDP ACCT, NUMBER OF UNITS ALLOCATED@$X.XX = $XX… .
i USED TO HAVE ONLY INDIVIDUAL CDP ACCT SO MY ESA OPERATION AT ATM ALWAYS NO PROBLEM.
NOW I HAVE ADDED A CDP JOINT ACCT WITH MY WIFE SINCE LAST YEAR.
I TRANSFERRED KEPPEL DC REIT SHARES TO MY JOINT-ALT CDP ACCT.
SO THIS WAS THE FIRST TIME i WAS USING THIS CDP JOINT-ALT ACCT FOR ESA AT ATM.
A STRANGE THING HAPPENED.
THERE WAS NO PRINTOUT AFTER MY ATM’S ESA OPERATION.
THIS MEANS i WAS UNABLE TO CONFIRM WHETHER i HAD USED THE CORRECT CDP ACCOUNT FOR ESA.
I PANICED SO i IMMEDIATELY ATM’S ESA OPERATION FOR 1000 EXCESS RIGHTS TO SEE WHY NO PRINT OUT.
THIS TIME THERE WAS A PRINTOUT.
SOME HOW i WAS “HAPPY” AND FELT REASSURED PRINTER WAS WORKING.
i DID NOT CHECK THE PRINTOUT CDP ACCT NUMBER.
(i THINK (AT THAT MOMENT) i WAS GETTING CRAZY OR GETTING LAU WU TU LOL!)
TO CUT THE STORY SHORT i GOT ZERO ALLOTMENT AND EXCESS RIGHTS.
(REMEMBER THERE WAS NO PRINT OUT AFTER ATM’S ESA OPERATION)
DXX IS CLAIMING i HAVE USED MY INDIVIDUAL CDP ACCT RATHER THE CORRECT NEW CDP JOINT-ALT ACCT.
TILL DATE I AM WAITING FOR THEM TO SEND ME A CONFIRMATION LETTER TO SHOW i HAVE USED THE WRONG CDP ACCT.
NOW FRIENDS, IT HAPPENED TO ME AFTER DXX’S ATM’S ESA OPERATION THERE WAS NO PRINTOUT THEREFORE UNABLED TO VERIFY ESA WAS DONE CORRECTLY.
IT HAS HAPPENED TO ME THEREFORE IT CAN HAPPEN TO ANYONE TOO IN FUTURE.
IT MAY EVEN HAPPENS TO ME AGAIN.
SO i HAVE ASKED DXX WHEN THERE IS NO PRINTOUT AFTER ATM’S ESA, HOW ARE WE TO VERIFY OUR ATM’S ESA HAS BEEN EXECUTED CORRECTLY?
TILL NOW NO SATISFACTORY ANSWER FROM THEM.
PARDON ME FOR LONG WINDED STORY.
I ONLY HOPE ALL OPMIs WILL BEWARE OF WHAT CAN HAPPEN AT ATM’S ESA (AKA WRONG CDP ACCT WILL GET ZERO SHARE).
SO CHECKING PRINT OUT TO ENSURE ATM’S ESA IS DONE CORRECTLY IS A MUST.
WHEN NO PRINTOUT, WHAT TO DO(HAPPENED TO ME)?
STILL WAITING FOR DXX’S SATISFACTORY ANSWER LOL!
Add comment
BEWARE NO MACHINE OR SOFTWARE IS “PERFECT”
THE RESPONSIBILITY ALWAYS IS PUSH BACK ON TO US TO SEEK REDRESS IF WE CAN.
IF WE CAN NOT “LL” LOL!
SORRY FOLKS, THAT NO ONE IS MORE INTERESTED IN YOUR MONEY THAN YOURSELF IS ALWAYS APPLICABLE.
IF YOU CAN’T DO SOMETHING ABOUT YOUR MONEY, NO ONE WILL EXCEPT MAKE YOU “POORER”
BEWARE OF ESA AT ATM’S INHERENT PROBLEMS.
NO SATISFACTORY ANSWER YET.
WHEN THERE IS, I WILL POST AGAIN.
WB:-
1) Rule # 1, do not lose money.
2) Rule # 2, refer to # 1.
3) Not until you can manage your emotions, you can manage your money.
Truism of Investments.
A) Buying a security is buying RISK not Return
B) You can control RISK (to a certain level, hopefully only.) But definitely not the outcome of the Return.
NB:-
My signature is meant for psychoing myself. No offence to anyone. i am trying not to lose money unnec
Frankly speaking I have no idea what you are writing.
It’s doesn’t matter now if you don’t understand.
My England is poor.
Only NTC 2.
WHEN OR IF IT HAPPENS TO YOU AT ATM’S ESA THEN YOU WILL DEFINITELY UNDERSTAND LOL.