Two banks were referred for possible sanctions on Friday in Hong Kong as part of an investigation into misleading sales tactics associated with Lehman Brothers, according to The New York Times.
Twenty-four cases involving allegations of misconduct and “mis-selling” against lenders was sent by the Hong Kong Monetary Authority. Investors have complained that bank salespeople misled them and did not make clear the troubles Lehman was going through.
‘’I believe banks will handle the problem as quickly as possible, but everyone needs to understand it takes time to estimate the value and design the buyback procedure,’’ Chan Ka-keung, Hong Kong’s secretary for financial services and the treasury, told The Associated Press.
The Securities and Exchange Commission said it was initiating an investigation into the cases referred by the Hong Kong Monetary Authority but would not comment until looking into the cases further.
More than 40,000 Hong Kongers bought Lehman-related investment products, estimating about $2.6 billion, according to NYT. The authority received more than 12,000 complaints connected to Lehman investments.