Solution: CPF should just require the sales charge to be paid upfront, (discounting an amount from CPF principle that CPF is confident it can monitor for abuse), anyhow, most of the fees go to annual management fees which CPF is supposed to have studied and endorsed.
Dec 26, 2009
Don't fall for the lure
By Joyce Teo, Property Correspondent
THE lure of getting their hands on some quick cash from their Central Provident Fund (CPF) savings is leading Singaporeans into a minefield with no end of legal and financial risks.
And if you are found guilty of violating CPF rules, you may find yourself poorer by as much as $10,000 or more.
The experience of Mr George Low (not his real name) illustrates the dangers.
He rang a mobile phone number from an advertisement aimed at people who needed fast money. A financial adviser asked for his CPF statement, which indicated that Mr Low had $100,000 available for investments.
The adviser began to invest Mr Low's $100,000 in a unit trust under the CPF Investment Scheme (CPFIS).
The sales charge for each transaction was 3 per cent of the investment sum, with the adviser getting a cut. In turn, he gave Mr Low a cash rebate of 1 per cent of the sum invested. In this case it was $1,000.
Read the full report in The Sunday Times.