Pages

Sunday, September 28, 2008

What is a fair compensation for mis-selling?

I asked a question, "If the distributor offer to compensate 50% of your loss, will you accept it?"

About 20 investors replied to my email account and to this blog. Most expect compensation of 80% to 100% compensation. A few replied that 50% is fair.

I hope that the investors will take the following points into account:

1. The advertisement did highlight that under a credit event, the investor can lose up to 100% of the principal.
2. The investor did sign a lot of documents (and they may be unaware of what they signed) which will cover the distributor against liability.

We can argue that the distributor has a sense of duty to make sure that the recommended product is suitable for the investor. But the investor has to bear some responsibility as well. This point is highlighted in a e-mail sent to me by MS. A few investors commented that the chance of getting compensation is small.

I hope that the expectation of the investors can be moderated.

0 comments:

Post a Comment