A group of 33,000 Hong Kong investors in Lehman Brothers-backed financial products plans to file a securities class action in the U.S. against HSBC, after Lehman’s collapse left their investments possibly worthless. The AP reports that the lawsuit is expected to be filed this month in New York against HSBC for its role in distributing the Lehman-tied investments. The majority of the investments were so-called “mini-bonds,” which are complex derivative products.
HSBC’s role was reportedly providing the directors for the special investment company set up to issue the mini-bonds and serving as a trustee that was supposed to hold the collateral backing the investment products. Other Hong Kong banks sold the mini-bonds to retail investors.