Hong Kong regulators must be impervious to shame. I recently came across an eight-year-old article about ILAS, which summarized the problems in the industry better than anything I’ve ever read. It was titled, “Guided by Greed“. What disturbed me most is that almost nothing has changed in the eight years since it was written. I think it’s time that regulators give this article a reread and ask themselves why they’ve been so slow to react.
At the end of the article, the SFC was quoted as suggesting that commission disclosure was the cure for mis-selling, since it seemed to be working in the UK. We now know that this is not true. The UK has continued to be plagued by an endless series of mis-selling scandals, and, along with Australia, has decided that completely banning commissions is necessary to protect consumers from the hordes of greedy shysters in the financial services industry.
Reprehensibly, after Hong Kong regulators admitted that commission disclosure was needed, it took them eight years to implement a half-assed version of the rule. Will Hong Kong have to wait another eight years for regulators to impose even a partial ban on commissions? If so, I hope they’ll be pummeled with deserved censure every single day until then.