Weekend Gossips + SRS Portfolio 4 July 2021

I am not sure if you read this article from Bloomberg or Edge, where it reported a US$1b investment fraud by Ng Yu Zhi (see below for this picture).

My colleague confirmed that Ng Yu Zhi was his school mate from Hwa Chong and probably that helps explain why Hwa Chong is considered a top school given how he was able to "convince" many top lawyers from other elite JCs...  into buying his fake promissory notes that offer 15% or more every quarter.

I have personally experienced how these con men work. They give you some sweetener to buy your trust initially. The victims will put in a small amount of money to "try it out" and after receiving payments for a few times or checking in with their high profile friends, they will get greedy and start pouring more money to the con man. In most cases, the victims will start "rolling" their investments upon expiry. This definitely helps with the cash flow from the con man's perspective. 

According to the CNA article, lawyer Sunil Sudheesan lost more than $1m, while Ms Pek Siok Lan, General Counsel from Temasek lost $5.5m. Dr Finnian Tan, who was featured in Me & My Money (with his new wife), lost $20m, cleverly diverted attention away by saying this is one of the 60 investments they have exposure to and almost praising himself for having diversification in the portfolio.

The media and netizens probably lapped into this latest news and Mr. David Gerald (whom I am sure know some of the victimes personally) is not going to have new friends here when he wrote the article "Why Greed and Envy Spell Trouble" for the Straits Times and rubbing salt into wounds ... 

For the kay pohs who want to know who Yu Zhi's wife is, I understand from my other kay poh friends that she is Coco Cai (see picture below)

See article on her lavish lifestyle here (I didn't verify the accuracy).

Frankly, if I am such a high profile person like Dr. Finnian Tan or Ms Pek Siok Lan, I will just lick my wounds and walk away. I guess once you "lodged a police report", it is beyond your control, otherwise, I am sure they would have chosen to stay silent.

As the chinese saying, 赔了夫人又折兵. This is a classic case where you lost both money and reputation. Once you lose your reputation, you lose credibility. Once you lose your credibility, your stakeholders (investors, employers, subordinates) won't trust you anymore, especially if you are in the investment field. This is the harsh reality of life.

I don't sense a lot of sympathy  as well when I speak to friends who know the victims and MAS even came out to say that the fallout from this incident on fund management is "limited".

So the key rule of thumb is if someone promises to give you more than 20% annually (or 5% a quarter), it is too good to be true... 

Interestingly, this Sunday Times also talked about one in two investors who touched their CPF ends up worse off and how one should use their CPF account for retirement. I personally don't use my CPF for investments as it is my "last line of defence". 

You can search for my articles on CPF here.  

SRS Portfolio - 4 July 2021

Here is the weekly update on my SRS portfolio. No new positions added and still sitting on a large pile of cash to be deployed.

The portfolio is now showing a gain of $10,143, largely driven by the run up in AEM Holdings. 

The fraud case is not the first and won't be the last. Stay vigilant and never let greed get the better of you!