Justice Bao Gong: What's the difference between Ah Longs and Banks?

(Source: Straits Times)
Very simple: Banks are clever while Ah Longs are at the short end of the intellect stick. Ah Longs hang PIG HEADS (Tiao Ter Tao) in debtor houses and get caught by police. Banks sell useless debt (Structured Products) but police cannot apprehend them. Why? Let us explain:

In today's forum, 2 concerned citizens have wrote in the Straits Times to suggest methods to prevent the same fiasco from occurring in future. But all these methods are already in place. With reference to our earlier post "MAS Speaks up- What investors need to beware", we have outlined how banks work behind the scenes and why they will never be wrong. We can only hope that they be ethical and assume responsibility rather than push the blame to the relationship managers (RMs).

Banks have already in place, compulsory compliance and audit training, risk disclosure forms for RMs to sign where they explicitly tell RMs that they have to disclose ALL the risks involved for every product that they sell to customers. As such, banks have already well protected themselves in case a debacle occurs, which it finally did, as in the Lehman Brothers case.

What banks have done was very clever: They need the revenue, but they want to thread on the safe end of the cliff, and thus, they create the above structures to protect themselves, while pushing the onus on the RMs to get the sales and take the blame. Imagine, using a reasonable man's point of view: If a RM is to tell the customer that he stand a chance to lose all his money should a reference entity faces a credit event; would the customer still want to buy the product? Definitely NO, so the onus is on the RM to subtly tell the risks involved while emphasising on the potential PROFIT of the product to influence the greed aspect of the customer such that the customer signs the product even though the RM has briefly mentioned about the risk (but only briefly & briskly) such that the customer did not heed the aspect of the risk but was actually thinking of the potential profits of the product. So when the tapes are replayed, it can be heard that the RM actually did mention about the risk, but the whole conversation was cleverly presented to emphasis on the emotional and the profit side of the product rather than the risk. That is why the suggestions given will not work. We do have a suggestion on a better way to protect the consumers, but the banks may not like it as it will hit their bottom line:

Currently, RMs' remuneration is pegged to the amount of revenue they make for the bank, which means the more 'high revenue' products they sell, the more they earn. What needs to be done is NOT to pay the RM according to the revenue they make, but rather peg the RMs' remuneration based on Customers' SATISFACTION and you can bet RMs will take much better care of their customers, as their income depends on the customers' satisfaction. As we speak, banks will HOWL with protest, as they know their bottom line will be hit. Well, it is for the public to judge: Do you want the banks to earn more? or do you want the bank staff to place priority for your financial well being? You be the judge.
Your humble servant

Car Insurance: Good hearted Man caught in insurance quagmire. YOU could be NEXT!

Car insurance industry in Singapore is apparently a very complicated and shady industry, as after so many changes to insurance reporting procedures to attempt to streamline accident claim procedures, accident claims remain ridiculously HIGH and nothing effective is being done about it despite several people having sufficient evidence that something wrong is going on among the various parties involved from workshop repairs to insurance claims. There has been several cases of very unhappy Singaporeans with the way inflated claims are not being investigated into and the cost of insurance are being passed on to the man on the street.

In this post, we will highlight the plight of businessman Mr Amirul, who is faced with claims of $18,000 for a small carpark bump in which his own repair for his Toyota Wish is only $650! We have done an interview and will unfold the events that occurred, resulting in this exhorbitant claim, and how you can PROTECT yourself against unscrupulous people who have no qualms about taking advantage of the complicated system to benefit themselves and passing on the cost of insurance to you:

The accident occurred on 5th Nov 07, when Mr Amirul was reversing his Toyota Wish, from the left of the picture, into an area which resemble a delivery ramp (Refer to Picture A). At the same time, the insurance agent was coming from behind and thus the accident occurred.

ACCIDENT SITE

The Toyota Wish was hit from the back of his vehicle as shown in the next picture, while the insurance agent’s Nissan Sunny was hit at the right side of his car during the accident. In Singapore, the car that knocks the behind of the car in front is generally at fault, but in this case, both parties seem to share a fair share of fault.

Nissan Car showing very slight dent in front right with no visible damage to headlamps nor bumper

Mr Amirul’s Toyota Rear Bumper showing a bigger dent

Immediately after the accident, the Insurance agent came out of his vehicle, bend down to look at the damages, walked to his car boot, opened up his briefcase and took out a piece of paper. He wrote a note explicitly stating Mr Amirul was at fault and asked Mr Amirul to sign which of course he did not. Mr Amirul disagreed that he was responsible for the accident but acknowledged that the accident did occur. The insurance agent wrote another note of acknowledgement that accident did occur and he claimed that it was for insurance claim and no lawyers involved. As Mr Amirul does not want to cause any obstruction to other vehicle along the driveway and the insurance agent ‘appeared’ to be very honest and sincere (he even offered to give Mr Amirul a better deal in his next insurance renewal and given his name card; AIG Insurance agent).They had the agreement that no lawyers will be involved and they will let the insurance settle the small accident as they assumed that damages would be limited only to a few hundred dollars, as shown by the pictures ( by the way those were the exact original pictures taken at the point of accident). At the point of accident, nobody was injured, including Mr Amirul’s 77 year old mother-in-law and 17 year old son who was sitted behind. Both parties then agreed to make report to IDAC separately. As for Mr Amirul he drove and proceeded to Paya Ubi IDAC straight away to do the necessary report, but according to the Amiruls, NO PHOTOGRAPHS were taken when their car was there.

A few weeks later in Dec 07, Mr Amirul received a lawyer’s letter demanding claims of $4672. And fast forward 3 months on 6 March 2008, Mr Amirul received a letter from NTUC Income for injury claim of $13,070! The injury claim was in respect of injury sustained by the insurance agent as a result of the minor accident. The insurance agent had gone to the Department of Emergency of Alexandra Hospital in the evening of the same day of the accident. In his medical report it was stated that he was ‘hit by a reversing car on the front of the door and subsequently developed cervical neck and left shoulder pain and was given 5 days mc’. ‘Subsequent visit for complaint of low back pain after the accident. X-rays done were normal and he was discharged with 2 days mc’.

According to Mr Amirul, he has gathered more than sufficient evidence that the exhorbitant claims is not justifiable and he has also engaged a private investigator showing the other party going through his normal daily movements which does not correspond to his claimed medical injuries. Mr Amirul had approached NTUC Income several times with these evidence, but NTUC remains unconvinced that the evidence is sufficient.

A few doubtful points were raised:

- Why is it that the insurance agent did not make a police report within 24 hours of the accident if he suffered a genuine injury? And only to come back with lawyer letters claiming exhorbitant injury claims 3 months later?

- The insurance agent’s medical report stated that his car was hit on the front of the door, but the original pictures show that the dent was at the front right side fender just behind the right headlamp.

- How fast can a car travel in a tight carpark area like the one shown above such that a 29 year old man can suffer injuries that can demand injury claims of $13070 while a 77 year old lady is not the slight bit injured?

- Why is it that the insurance agent who had a clear view of Amirul’s car in front and thus, can anticipate the impending accident, suffer a whiplash injury to back and neck while Mr Amirul’s 77 year old mother-in-law, who had no idea nor no any view of any impending accident did NOT suffer any slight injury at all?

Bear in mind the driver of the Nissan Sunny who made the exhorbitant claim is an insurance agent who has been in the insurance line for 7 years, while Mr Amirul has no inkling of the intricacies of insurance. Being in the insurance line for so long, it is obvious that one party knows the industry very well, and its very loopholes and thus more likely to be able to capitalise on the system.

Mr Amirul has been kind enough to share their experience to benefit the man on the street so that they will not fall into the same predicament. Remember, the above could happen to YOU! Do share with your friends this website and bookmark this website (Ctrl D) so that everyone can benefit from it. So, what should you do in an accident?

- NEVER sign any written acknowledgement which has any words that suggest you are at fault, as it could be cleverly phrased and used against you in Court.

- Always take pictures (closed up and with vehicle number visible together with damage).

- Exchange particulars of all parties.

- Obtain witness contacts and if possible, written account of their testimonials, as cases can drag for months and witnesses will forget the details

- Confirm that no party is injured (Record conversation or have it stated in writing to declare that everyone is not injured, or get witness to verify) This is to ensure that neither party will malinger and slap you with ridiculous medical injury claims later on. Everyone knows how easy to fake injury or illness or attribute old injuries to this accident in order to unethically claim insurance monies at another party’s expense.
We are a non partisan blog and we welcome the other party to post his comment and let the public decide.

If you suffer from similar insurance grievances, I implore all readers to place a comment, email us & bookmark us, and ask your friends to visit justicebaogong.blogspot.com to place their comments. All constructive comments are welcome. If you suffer from similar grievances, do place your comments, and we will endeavour to highlight your predicament so that other people can benefit. We strive to reach out to as many people as possible and through collective strength, we can create change for the better. We welcome anyone to link articles to our articles for the benefit of all.

Your humble servant