A review is under way, said Trade and Industry Minister Lim Hng Kiang yesterday as he gave more details of complaints from investors who lost money on the Lehman Brothers-linked investment products. He said there may be recommendations for 'an even clearer separation between a bank's traditional deposit-taking business and its investment product sales and marketing activities'.

A public consultation on the proposals is planned by mid-March.

At present, investment products can be sold only by financial advisers, who are not allowed to perform bank counter duties. But more segregation may come, as well as other legislative changes.

Another change could be 'a requirement for the appointment of an approved trustee with prescribed powers for certain investment products such as structured notes'. Other possible changes include enhancing the rules for advertising and marketing materials, and introducing documents summarising product details.

Investor education also needs to be stepped up, he said. The Monetary Authority of Singapore (MAS) is working on it with various stakeholders, including the Consumers Association of Singapore and the Securities Investors Association of Singapore.

Mr Lim made these points when replying to Mr Inderjit Singh (Ang Mo Kio GRC) and Mr Sin Boon Ann (Tampines GRC) in Parliament.

When asked about the total compensation paid, he said it was not possible to release the figure because offers are being sent out and some investors may reject the offer. He also did not want to go into the specifics of 'vulnerable' cases that were compensated.

He said a single characteristic like age did not determine if an investor would be vulnerable to being mis-sold the products. 'Someone with little formal education may be a successful businessman.'

Mr Lim, who is also MAS deputy chairman, said 471 of the 700 or so retail investors who bought into Series 9 and 10 of Pinnacle Notes have made complaints.

About $26 million had been invested through DMG & Partners Securities, Hong Leong Finance, Kim Eng Securities, OCBC Securities and UOB Kay Hian. Issuer Morgan Stanley said in November that the series were likely to be worthless.

The MAS is ensuring that the institutions use the same review process employed for investors in Lehman Minibonds and other failed notes. Insurance veteran Hwang Soo Jin, who advised institutions in those cases, is overseeing the complaints process at the stockbroking firms. Hong Leong Finance is in the process of appointing an independent person.

Last Friday, MAS said about 58 per cent of more than 5,000 investors who complained about investments in Lehman Minibonds, DBS High Notes 5 and Merrill Lynch Jubilee Series 3 Linkearner Notes will receive full or partial compensation.

'Overall, this is a fair result,' said Mr Lim yesterday.

Investors who are unhappy with the outcome can turn to the Financial Industry Disputes Resolution Centre (Fidrec).

As of last Wednesday, Fidrec had received 227 cases, including 55 cases on High Notes 5, 136 on the Minibonds, 30 for the Jubilee Series 3 and six on the Pinnacle Notes.

Non-Constituency MP Sylvia Lim noted that Hong Kong had interim measures to avoid another incident while Singapore's consultation exercise was still pending. Mr Lim replied that Singapore's process works because cases had been resolved, unlike in Hong Kong.

He also said that MAS believes in a more deliberate approach, where feedback from financial institutions and public is received before making a decision.