Women sued OCBC for freezing accounts worth $8.9million

27 Jan 2010
Source: The Straits Times

A WOMAN, whose 93-year-old adoptive mother has sued OCBC Bank for freezing her bank accounts, yesterday conceded that the bank was justified in being suspicious when the two women went to open a joint account nearly two years ago.

The bank refused their application, doubting the elderly woman’s mental competence to manage her financial affairs.

But Ms Amy Hsu Ann Mei, 44, said that the bank in its prudence should have found out more about their mother-daughter relationship.

“If they are suspicious of me, they should find out who I am… the number of years I spent with my mum, how long my mum and I lived together, the number of years she raised me,” said Ms Hsu, under cross-examination by the bank’s lawyer.

Adopted by Madam Hwang Cheng Tsu Hsu at a young age, Ms Hsu is the only child of the retired teacher.

As Madam Hwang’s health deteriorated last year, Ms Hsu was ordered by the court to be her mother’s legal representative to continue the suit against OCBC for freezing her accounts containing $8.9 million.

On the stand yesterday, she set out the events surrounding the opening of the joint account which led to the legal spat.

In February 2008, Madam Hwang’s signature on her cheques became inconsistent following a hip replacement surgery, she said.

Ms Hsu said it was her mother’s relationship manager, visiting Madam Hwang in hospital to verify the signatures, who suggested the two women open a joint account to make it easier to operate the older woman’s accounts.

In May 2008, Madam Hwang and Ms Hsu went to the bank to open the account, but were rejected.

Later, when Madam Hwang demanded to close her accounts and take out all her money, the bank refused and subsequently froze the accounts.

The bank’s position is that it was being prudent as its officers had concerns about Madam Hwang’s mental capacity to handle her bank accounts.

Among other things, bank officers who visited her at home said she gave inconsistent answers to their questions, for instance, saying she was 80 years old.

In her affidavit, Ms Hsu’s response to this was: “Even assuming that the averment is correct, I know that my mother’s view is that it is a woman’s privilege to hide her true age!”

She accused OCBC of breaching its duty of care by sending the bank statements to her mother’s niece and by acting on the instructions of her mother’s nephew, lawyer Michael Hwang, without question.

Ms Hsu, who does not live with her mother, blamed OCBC for causing her and her mother to miss investment opportunities when property prices fell in the first half of last year.

Ms Hsu said that they had been thinking of investing $6 million to buy apartments for rental income.

She said Madam Hwang, who lives at the Waterside condominium in Tanjong Rhu, had also wanted to buy a unit at the nearby De-Centurion condominium for her daughter.

Yesterday, OCBC’s lawyer Adrian Wong referred Ms Hsu to a Canadian legal article about fraud against the elderly, which said that 90 per cent of the perpetrators are family members.

Mr Wong went through the list of red flags that banks should watch out for and the safeguards they should take against financial exploitation of seniors.

The lawyer pointed out that OCBC was put on alert because it was the first time it was getting instructions from Ms Hsu regarding Madam Hwang’s accounts.

She replied: “You have to ask OCBC. Whatever I did, I did it from my heart. I did it for my mother.”

However, when pressed further, Ms Hsu agreed that the bank had a duty to be prudent but questioned if it had acted appropriately

About the case:

Yesterday was Day 2 of the hearing into the lawsuit that Madam Hwang Cheng Tsu Hsu, 93, has brought against OCBC Bank for freezing her accounts containing $8.9 million.

The legal dispute arose after Madam Hwang and her daughter Amy Hsu went to the bank to open a joint account but were turned down.

OCBC’s stand is that it was acting as prudent bankers and safeguarding Madam Hwang’s interests as it had concerns about her mental capacity to handle her accounts.

Madam Hwang, alleging that OCBC has breached its contract by refusing to comply with her instructions, is seeking unspecified damages.

She contends that by locking up her funds, OCBC has deprived her of opportunities to invest in property.

Since filing the suit, she has applied to court for various sums to be paid out as expenses. The balance has been moved to a court account pending the outcome of the case.

As Madam Hwang’s health deteriorated last year, Ms Hsu was ordered by the court to continue the suit on her behalf.

Ms Hsu continues on the stand today.

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