RJ and Makay

The China Post reports that Hong Kong’s financial community is incensed over a so-called “mystery shopper” program planned by the Securities and Futures Commission (SFC) and the Hong Kong Monetary Authority.  In a controversial move, these regulating bodies decided to hire actors, including pregnant women and those who are of retirement age, to ensure that banks and brokerages are using legitimate techniques when selling investment products.  The financial services industry is concerned that this type of program could snare both good and bad financial advisors alike, and ruin their careers.

Glenn Turner, Chairman of Hong Kong’s Independent Financial Advisers Association said, “It’s a mess – this kind of entrapment will hurt a lot of honest, hardworking people.”  Two years ago, a mis-selling scandal and the collapse of Lehman Brothers resulted in the loss of investments made by over 40,000 Hong Kong investors, many of whom were retirees. The bank failure triggered much anger against the financial community. Investors claimed they had been misled about the risks involved and led angry protests against the banks, the government and the financial regulators.