A recent case involving the suspected mis-selling of a wealth management
product by Hua Xia Bank in China has showcased the risks banks face
from individual sales staff acting on their own, according to a Beijing
lawyer. Her comments followed an announcement earlier in December that a
former employee of the bank had mis-sold a high-risk wealth management
product (WMP) to a customer without explaining the risks involved. The
WMP later stopped making repayments.
The Hua Xia incident was an extreme example of how things could go
wrong, and reflected a failure by the bank's risk management department
to spot the risk, said Jane Jiang, partner at law firm Allen & Overy
in Beijing. She said the case revealed that the contractual
relationship between the bank and its customers was not clear. If the
former Hua Xia employee sold WMPs at the bank’s counter, the bank
arguably gave implied authorisation by allowing such WMPs to be sold at
the bank, said Jiang.
To read more, please visit:
http://www.complinet.com/global/news/news/article.html?ref=160858&bulletin=spotlight®ion=_10115
No comments:
Post a Comment