The Consumer Council has put in place a special workforce to handle the Lehman Brothers cases and to consider providing financial assistance for legal action under the Consumer Legal Action Fund (CLAF).
Since a fortnight ago (following the Policy Address by the Chief Executive), in addition to mediation between the complainants and the banking sector, the Council has begun the task of vetting the large volume of consumer complaints about Lehman Brothers minibonds. The goal is to identify cases for consideration of CLAF for legal assistance.
As of yesterday (October 29), the Council has received 3,638 complaints and 1,388 enquiries. So far, in the initial phase of the operation, a batch of some 50 cases has been selected for processing.
The selection criteria will focus mainly on the vulnerability of the complainants, as well as cogency of evidence regarding untoward sales tactics, inadequate risk disclosure and mispresentation, etc.
Work has begun to arrange for the selected complainants to be interviewed to gather detailed information, to be followed by a preliminary legal analysis on each case before reporting to the CLAF Management Committee for recommendation to the Board of Administrators for its approval.
To expedite the legal work, the Council is commissioning out a portion of the work to barristers in private practice to assist in the taking of statements and preparation of legal analyses.
The CLAF Management Committee will convene later today (October 30) to discuss a strategic plan and related legal matters in dealing with the applications in the Lehman Brothers case. (A press briefing will be held by the Committee Chairman, Prof. Johannes Chan, prior to the meeting).
In parallel with the Council's initiative, the Council has also received two applications from the public (one in mid-October and the other yesterday) for legal assistance of CLAF.
In the case of the first application, it was deemed to be a meritorious case with substantial evidence for litigation proceedings. However, the applicant has just asked to withdraw the application on personal grounds.
The Council is processing the second application.