In this week’s blog I will inform you about the so-called deceiving products of Lehman Brothers. The decision to prosecute Deutsche Bank was taken yesterday and is confirmed by the spokesman of the public prosecutor’s office.
Earlier, Citibank sold structured bonds of the company Lehman Brothers that is now declared bankrupt. Last year, Citibank was brought before the criminal judge in a event hall to provide for the stampede of people rushing to get their money back.
The complaint regarding Citibank resembles to the one held against Deutsche Bank. The public prosecutor’s office claims that the customers of Deutsche Bank were unaware of what they were buying. The information given concerning the product was incorrect, they claimed that the product did not contain any risks, but after all the contrary came true.
The Deutsche bank has tried to make amends with their customers. They were prepared to buy the pieces at the rate that is formed for these products on the secondary market. Using that method, customers can regain 33 % of their initial investment.
After reading the article, I was really shocked that things like these still happen. There are so many organizations looking out in the interest of the customers such as Test Aankoop (not in this segment of the market of course).
On the contrary, there are many people that are unaware of these malpractices and believe the agent sitting in front of them, informing them about the product. After all, people have a lot of confidence in these agents because they are ought to tell clients what they should do with their savings.
http://www.standaard.be/artikel/detail.aspx?artikelid=6M2OAADD&subsection=215
I also regret that things like these still happen. Maybe we as depositors, are too trustful. But how many clients do know or understand what the information about the product really means? I think all the banks do not say a word of the possible risks of investments in this crisis. We as consumers get the advice to have a talk with the bank director about having a better return… But do we actually understand all the technical terms used by the bank director? This incident proves the weakness of the consumer and it’s time to change that!
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