Australian (ASX) Stock Market Forum

Storm Financial Group

Jump to new
"CBA tightens rules to weather crisis"

"Commonwealth Bank of Australia is tightening up its lending practices and closing a major loophole for potential abuse by preventing mortgage brokers from using borrowers' proposed investment income for servicing mortgage payments."

Read more by Duncan Hughes in The Australian Financial Review of Monday, 14 September 2009.
 
Solly said:
"Storm founder and investors hold secret meeting"

"Emmanuel Cassimatis, founder and ex-chief executive of Storm Financial, is believed to be seeking support from former investors in his collapsed company to bring a legal action against the Commonwealth Bank of Australia."

Read more by Duncan Hughes in The Australian Financial Review of Sept 10, 2009.
Click to expand...

Here's the AFR article (albeit a few days ago) : - View attachment AFR - 10 SEP 2009.pdf
 
:) To paraphrase Oscar Wilde "Law is the last resort of a rogue." With apologies to the nicer lawyers and litigants.

Wonder what happened to the implied promise of continuing to fight on behalf of all Storm clients? Yeah, I forgot, it was one of those non-core promises.
 
Just watched JPC Committee and David Liddy of BoQ having a "chat". David Liddy made a comment that 40 odd customers have paid out their home loans this year....so the BoQ home loans were issued on viable grounds and not that unrealistic in affordability based on income.

Well Mr. Liddy, I know for a fact that some of those loans were paid out by very stressed customers through funds obtained from family and/or sale of assets (homes, other shares, property etc) and smaller loans (for balances still owing) at a cheaper rate than BoQ's rate from other banks.

I also am aware that many customers have had funds placed in dam accounts set up by Storm and have been able to make home loan repayments for approximately six to 12 months. This was what being self-funded retirees meant...the fund making the repayments.

So just maybe that is why there were no hardship case in January 09 and only 46 in July. Will be interesting to see the number by the end of the year when many dams have dried up.
 
Anastasia said:
Well Mr. Liddy, I know for a fact that some of those loans were paid out by very stressed customers through funds obtained from family and/or sale of assets (homes, other shares, property etc) and smaller loans (for balances still owing) at a cheaper rate than BoQ's rate from other banks.

I also am aware that many customers have had funds placed in dam accounts set up by Storm and have been able to make home loan repayments for approximately six to 12 months. This was what being self-funded retirees meant...the fund making the repayments.
Click to expand...

WHAT!!!

They used other assets to pay off the loans which they took out with BOQ

Blasphemy.

OF COURSE that is the way it goes. Why should Storm investors have any leeway if BOQ did everything correctly?

ie If I borrow 1million and have 1.5 million in cash, of course I can pay off the debt, so should stormers.
 
"ASIC considers ban on financial advisers' fees"

"The Australian Securities & Investments Commission's recommendation came last night as the Bank of Queensland staunchly defended its role in lending money to customers who invested with Storm Financial."


"Mr D'Aloisio defended ASIC's failure to step in and take action to protect investors before Storm's collapse.

"We don't believe we missed the issues," he said."

More by Nicola Berkovic in The Australian here;

http://www.theaustralian.news.com.au/business/story/0,28124,26084892-36418,00.html
 
"Tough rules 'will flush out advisers' "

"Tighter regulation of advisers could lead to a "lot of people" leaving the financial services industry, Australian Securities and Investments Commission chairman Tony D'Aloisio told a parliamentary inquiry yesterday."

Read more by Duncan Hughes in The Australian Financial Review 17th Sept 2009
 
"Storm Financial collapse: watchdog vows to fight for justice"

"AUSTRALIA's corporate watchdog will continue its probe into the Storm Financial collapse over the next six weeks before deciding whether to pursue legal action.

Australian Securities and Investments Commission chairman Tony D'Aloisio last night told the federal parliamentary inquiry into financial products and services that its probe into the failed Townsville-based company was one of the largest in history."

More by Emma Chalmers and Stefanie Balogh in The Courier Mail here;

http://www.news.com.au/couriermail/story/0,27574,26084160-3102,00.html
 
"Bank of Queensland defiant in wake of collapse"

"The Bank of Queensland has broken its silence about its involvement in the Storm Financial collapse standing by its lending practices as 'correct' and above board."

Read more by Emma Chalmers and Stefanie Balogh in The Courier Mail.
 
I am still mystified as to how people could borrow against their home and not think that it was not a mortgage or a debt that had to be repaid at some stage but there ya go folks.

http://www.theaustralian.news.com.au/story/0,25197,26082940-28737,00.html


Storm damage

Andrew Fraser | September 17, 2009
Article from: The Australian

TOWNSVILLE man Trevor Power was unemployed when he got a loan through Storm Financial in 2003. The trouble was, he never knew who was lending him the money until he received a bank statement from Macquarie Bank that showed him in debt to it.

"It was all done at Storm, all Storm letterheads. I never once saw a bank document until we started getting statements, and it was Macquarie," he told last week's Townsville sitting of the Parliamentary Joint Committee on Corporations and Financial Services. He wasn't the only witness before the inquiry who expressed surprise about his real financial dealings after what he had been told and led to believe by representatives of Storm Financial.

Continued........
Click to expand...

Soft Dough, I think that in any situation such as Storm, you will get people who knew very well what they were doing and why as well as the risks involved but are now using the matter to their advantage in order to avoid their obligations. Not many for sure but it would not surprise me if there were a few. Human nature is what it is.
 
I was a Storm 'victim', but my partner and I knew EXACTLY how much money we were borrowing from exactly which financial institution. It was all written on page 2 in layman's terms on our SOA.

The biggest thing that has made me angry, is that we weren't in margin call, and yet our investment was sold at the bottom of the market without any consultation to us by Colonial, and our margin loan paid back at a loss with the proceeds, despite us having extra assets and money in a joined CMA to avoid margin call. We knew what was going on, and we didn't even have a house betting on it....just a block of our savings as a young couple.

For people to claim 'Storm borrowed $1 million for me, and I didn't know about it' is absolute bollocks. You might not have understood the section that read 'we propose you borrow $1 million from bank X to invest into your existing Storm index fund', but for all of their faults, Storm never put a gun to people's head and made them sign for ridiculous loans.

My heart goes out to the majority of fellow Storm investors, but there are a number of people now pulling the Alan Bond 'I have low IQ and don't know what I was doing' card to avoid responsibility for their own apathy.

If millions of dollars of my super and retirement was on the line, I would have been down at the Storm office in person everyday demanding to see what was going on, and same for Colonial Lending. I hate to say it, but it's endemic of society nowadays, no one takes any responsibility for anything, Manny, the banks and Storm customers included.

Not sinking a boot in, but hopefully people learn from this.
 
Ironhalo said:
I was a Storm 'victim', but my partner and I knew EXACTLY how much money we were borrowing from exactly which financial institution. It was all written on page 2 in layman's terms on our SOA.

The biggest thing that has made me angry, is that we weren't in margin call, and yet our investment was sold at the bottom of the market without any consultation to us by Colonial, and our margin loan paid back at a loss with the proceeds, despite us having extra assets and money in a joined CMA to avoid margin call. We knew what was going on, and we didn't even have a house betting on it....just a block of our savings as a young couple.

For people to claim 'Storm borrowed $1 million for me, and I didn't know about it' is absolute bollocks. You might not have understood the section that read 'we propose you borrow $1 million from bank X to invest into your existing Storm index fund', but for all of their faults, Storm never put a gun to people's head and made them sign for ridiculous loans.

My heart goes out to the majority of fellow Storm investors, but there are a number of people now pulling the Alan Bond 'I have low IQ and don't know what I was doing' card to avoid responsibility for their own apathy.

If millions of dollars of my super and retirement was on the line, I would have been down at the Storm office in person everyday demanding to see what was going on, and same for Colonial Lending. I hate to say it, but it's endemic of society nowadays, no one takes any responsibility for anything, Manny, the banks and Storm customers included.

Not sinking a boot in, but hopefully people learn from this.
Click to expand...

Did you sign a letter back in October 2008 to convert your portfolio to cash?
 
I am probably wrong as usual but I think I see a glimmer of why some investors were sold out without consultation even though they could have met any margin call. It probably would have been sending good money after bad.

Have a read of the evidence from CBA of 4 September and in particular the CBA comments on pages 101 and 102. The value of the funds due to redemptions and the market went from $700m to $46m in six weeks. As the CBA said some $11m per fund. At that level they were not viable apparently and so were closed.

I am hazarding a guess that meeting a margin call would mean that one individuals money would have been spread across all other remaining investors, ie pooled, and not changed the viability of that fund in any way shape or form.

http://www.aph.gov.au/hansard/joint/commttee/J12379.pdf
 
I signed a letter, but that authorised Storm to sell us down in case we got close to a margin call. It didn't authorise Colonial to do it when we still had a 30% buffer before we did.
 
Ironhalo said:
I was a Storm 'victim', but my partner and I knew EXACTLY how much money we were borrowing from exactly which financial institution. It was all written on page 2 in layman's terms on our SOA.

The biggest thing that has made me angry, is that we weren't in margin call, and yet our investment was sold at the bottom of the market without any consultation to us by Colonial, and our margin loan paid back at a loss with the proceeds, despite us having extra assets and money in a joined CMA to avoid margin call. We knew what was going on, and we didn't even have a house betting on it....just a block of our savings as a young couple.

For people to claim 'Storm borrowed $1 million for me, and I didn't know about it' is absolute bollocks. You might not have understood the section that read 'we propose you borrow $1 million from bank X to invest into your existing Storm index fund', but for all of their faults, Storm never put a gun to people's head and made them sign for ridiculous loans.

My heart goes out to the majority of fellow Storm investors, but there are a number of people now pulling the Alan Bond 'I have low IQ and don't know what I was doing' card to avoid responsibility for their own apathy.

If millions of dollars of my super and retirement was on the line, I would have been down at the Storm office in person everyday demanding to see what was going on, and same for Colonial Lending. I hate to say it, but it's endemic of society nowadays, no one takes any responsibility for anything, Manny, the banks and Storm customers included.

Not sinking a boot in, but hopefully people learn from this.
Click to expand...

Good post Ironhalo - I think you're right that there will always be people who overplay the victim card in these situation. I've also started to see where the banks failed some Storm Investors. The issues seem to me to stem more on how the bank processed redemptions from the fund, and their decision to wind up the fund. It would be interesting to understand more of what went on here.
 
Judd said:
I am probably wrong as usual but I think I see a glimmer of why some investors were sold out without consultation even though they could have met any margin call. It probably would have been sending good money after bad.

Have a read of the evidence from CBA of 4 September and in particular the CBA comments on pages 101 and 102. The value of the funds due to redemptions and the market went from $700m to $46m in six weeks. As the CBA said some $11m per fund. At that level they were not viable apparently and so were closed.

I am hazarding a guess that meeting a margin call would mean that one individuals money would have been spread across all other remaining investors, ie pooled, and not changed the viability of that fund in any way shape or form.

http://www.aph.gov.au/hansard/joint/commttee/J12379.pdf
Click to expand...
Thanks for that link, Judd. I've only skimmed through it but it certainly appears that the Committee are being most diligent.
Some very interesting stuff there, especially the part you've outlined above.
 
"BoQ 'has Storm case to answer' "

"Bank of Queensland "has a case to answer" over its lending practices to clients of Storm Financial, the chairman of the federal parliamentary committee investigating the adviser's collapse, Bernie Ripoll, said yesterday."

Read more by Duncan Hughes in The Australian Financial Review of Sept 18 2009.
 
"Storm legal options decided by end of October"

"AUSTRALIA's corporate regulator says it is still considering what, if any, legal action it will take against key players in the Storm Financial disaster.

However, Australian Securities and Investments Commission has revealed it could decide its legal options at the end of October.

The banks are facing potential action under the regulator's public interest powers, while Storm founders Emmanuel and Julie Cassimatis are facing possible actions for breaches in their roles as company directors and financial advisers."


More by Tony Raggatt in The Townsville Bulletin here;

http://www.townsvillebulletin.com.au/article/2009/09/18/80071_news.html
 
"Bank of Queensland can't shelter from Storm"

"YOU have to wonder about the Bank of Queensland's strategy to cope with its toxic exposure to the Storm Financial debacle.

It obviously obtained legal advice that the best course of action is to dig in its heels, admit to little or no wrongdoing and fight any legal bids seeking redress."

More by Anthony Marx in The Courier Mail here;

http://www.news.com.au/couriermail/story/0,23739,26084949-3122,00.html
 

Similar threads

TiminOz
The dynamics of money and TIME: crimping cashflow for a period
Replies
3
Views
862
TiminOz
TiminOz
BossMan.
The planning of a portfolio
2
Replies
29
Views
1K
Value Collector
Value Collector
basilio
Ozempic: Magic Pill or Devils Bargain?
Replies
10
Views
2K
sptrawler
sptrawler
ducati916
February 2025
2 3 4
Replies
60
Views
5K
ducati916
ducati916
Garpal Gumnut
Mayfair 101/Mayfair Platinum
2
Replies
35
Views
5K
Dona Ferentes
Dona Ferentes
Top