"Withdraw Compensation Plan and Compensate Principal" Relay Rally by Hong Kong ELS Subscribers

"Cannot Accept Administrative Adjustment Plan Favoring Perpetrators"
Signs of 'Bank Run' as Deposits Are Transferred

Financial authorities have released a dispute mediation guideline related to the massive loss incident involving Hong Kong H Index (Hang Seng China Enterprises Index·HSCEI) based equity-linked securities (ELS), but those who subscribed to the product expressed dissatisfaction, demanding the withdrawal of the compensation plan and the official declaration of contract invalidity and principal compensation. They also staged a ‘bank run,’ withdrawing deposits from NH Nonghyup Bank and transferring them to other banks.

At the ‘Nationwide Financial Fraud Contract Nullification’ rally held at the Nonghyup Central Association headquarters in Seodaemun-gu, Seoul, at noon on the 15th, Gil Seong-ju, chairman of the Hong Kong ELS Victims’ Association, said, “We can never accept the shameless and petty administrative mediation plan that supports the fraud perpetrators,” adding, “The bank must fully compensate the principal as well as the losses.”

Chairman Gil added, “The guideline that adjusts compensation ratios based on ELS investment experience and financial product understanding divides the victims and severely distorts the essence of the current situation.”

[Image source=Yonhap News]

Subscribers also shared their damage cases. Mr. A, who took the stage on behalf of his mother in her 70s, appealed, “It is a clear violation of the suitability principle to have managed retirement funds, including my father’s industrial accident insurance money, by subscribing to the ultra-high-risk product ELS,” adding, “I was deceived by the sweet talk that ‘there is no loss as long as the country does not collapse,’ but this is a blatant nationwide fraud indistinguishable from voice phishing.”

Mr. B, who reportedly departed from Busan at dawn, cried out, “Is it wrong to have trusted and signed without suspicion because the bank I have dealt with for 30 years said it was safe?” and “I earnestly appeal to return at least the principal so that I can trust banks and save money in the future.”

There was also a subscriber who predicted a legal battle. Mr. C, who took the microphone for his self-reproaching wife, emphasized, “Even if it takes up to five years and goes to the Supreme Court, I will fight legally and give my wife 100 million won in losses after five years,” adding, “I will also receive compensation for the pain over the five years.”

[Image source=Yonhap News]

At the rally, there was also a ‘bank run’ as a resolution action by the victims. It involved taking a number ticket at Nonghyup Bank, withdrawing deposited funds, and transferring them to other banks. According to the organizers, about 50 people participated. Mr. D, who participated in this act, said, “Today, I will first withdraw 20 million won and plan to withdraw all 200 million won I hold as soon as my savings mature.”

During this process, a commotion broke out between the organizers, police, and Nonghyup Bank officials. For safety reasons, participants were admitted in groups of 15, causing the remaining participants to wait outdoors for about 10 minutes. At the entrance, men who appeared to be police officers and security guards were stationed. Complaints erupted in the waiting line, such as “Are you making customers stand in the cold?”, “When committing fraud, the doors were wide open,” and “I will withdraw everything except 18 won.” Chairman Gil also expressed anger, saying, “I want to ask on what grounds and under whose orders this is happening.” A Nonghyup Bank official explained, “Later, we opened additional entries, and ultimately more than 50 people entered.”

Meanwhile, the victims’ association announced plans to hold a surprise press conference in front of the Bankers Association in Jung-gu, Seoul, on the 18th, when Financial Supervisory Service Governor Lee Bok-hyun and the Bankers Association board will hold a meeting. They also said they will hold a rally at the KB Kookmin Bank headquarters in Yeouido, Seoul, on the 29th.