Clients of the brokerage firm «Jusan Invest» have stated that they lost up to 90% of their deposits. Those affected believe they were misled, having been presented with a 'perfect option' for investment. The broker itself admits no fault and shifts the blame onto the depositors, who, in its view, should have been aware of all the risks.
In 2021, clients of JSC «Jusan Bank» received a tempting offer: to invest funds in a new financial instrument from JSC «First Heartland Jusan Invest» with almost guaranteed returns and at a high interest rate (see photo). Among the depositors were successful entrepreneurs, employees of the bank itself, economists, and managers.
The new investment option consisted of so-called ‘structured notes’ – single securities packaging a combination of assets and instruments offered by the bank. The structured notes included shares of four different companies, for which a fixed annual return was promised.
Furthermore, clients were presented with a mobile application which (it was claimed) would allow them to track the yield of the structured notes in real time. However, in the spring of 2023, when the financial instruments suddenly began to lose value by 70% to 90%, the application went down for a week and a half.
Thus, the company's clients were unable to sell the securities in time and lost almost all of their investments. The victims are certain that the brokerage firm misled them by presenting this financial instrument as a deposit with a guaranteed return and insurance against a fall in its value.
As lawyer Aidar Kashkarbayev noted, a structured note is a kind of 'bet on the future', that is, a fairly risky investment option. However, depositors were not only not informed about the degree of this risk, but this type of investment was actively advertised to them, being called 'reliable' and promising high interest rates.
Meanwhile, at «Jusan Invest» they do not admit fault. The company believes that clients should have been aware of the risks of investment deposits, given the high interest rate (up to 20% per annum).
Furthermore, it is noted that the structured notes were issued by major international banks, and «Jusan Invest» is not a second-tier bank and does not accept deposits from clients promising them profit. It merely provides brokerage services for the purchase of financial instruments.
The company did not disclose the cause of the technical failure in the mobile application, but emphasised that, by law, brokers are not obliged to inform clients about market changes in real time.
As appeals to JSC «First Heartland Jusan Invest» yielded no results, the depositors turned to the Agency for Regulation and Development of the Financial Market (ARDFM) requesting an appropriate inspection. Following the inspection, the authority drew up as many as 82 reports of administrative offences against «Jusan Invest».
Among the serious violations, it was found that JSC «First Heartland Jusan Invest» did not have the right to sell certain financial instruments to Kazakhstani clients, as they were unqualified for such investments.
Furthermore, it was proven that clients were not adequately informed about how structured notes work and what they are. Due to the lack of necessary information, depositors could not make decisions to protect their investments (sell them early), resulting in significant financial damage being inflicted upon them.
Despite the brokerage firm being ordered to pay a fine to the state, there is no guarantee that the victims will be able to recover their invested funds, because it is precisely the securities they invested in that fell in value, a responsibility no broker in the world bears for. Such, unfortunately, are the laws of the financial market.
As some analysts believe, the chances of obtaining compensation are extremely slim, but the sad experience of the depositors may serve as a lesson for many other potential investors.