Storm Financial Group

[SJG1974]

Surely they don't believe anyone (at all!) is buying this rubbish. The mkt completely tanked and blind freddy knew those with high LVR margin loans were in strife.

Exactly. The fact that clients were invested in index funds means that a simple look at the paper, the TV or an internet site would have meant that they knew their clients were in strife. If in fact the data was inaccurate, they surely would have known this (wouldn't they be suspicious with the market falling say 5% in a day yet their client's portfolios didn't?)....why didn't they go back to the CBA and repeatedly ask for the data to be fixed?

They are financial advisers FFS....they get paid a huge fee to manage and monitor people's portfolios. Every adviser would have an idea of what the market is doing....why didn't they?

It is a cop out.

 

[cuttlefish]

I guess this means the fund was also unhedged against the extremely sharp falls that occurred. Whats the norm with index funds - are they literally just an index weighted basket of direct shareholdings or is some hedging usually incorporated as well?

 

[DocK]

I guess this means the fund was also unhedged against the extremely sharp falls that occurred. Whats the norm with index funds - are they literally just an index weighted basket of direct shareholdings or is some hedging usually incorporated as well?

My understanding (from discussions with my storm "adviser") is that the index funds were indeed simply an "index weighted basket of direct shareholdings" and there was never any mention of hedging. Clients were not invested with or in storm per se, they were invested in managed funds (index funds) in my case with Challenger.

I agree that to say they were unaware or could not work out their clients' lvrs due to innacurate data is an absolute cop out! My SOA clearly recorded the level of the All Ords at the time the investment was made, it doesn't take a rocket scientist (and clearly I am not one!) to work out that if my funds were invested in an index fund, and that index has fallen by x%, then presumably my investment has fallen by a very similar %. The storm pitch was always "we're here to look after your money so you don't have to", along with constant reassurances that their clients' portfolios were being constantly monitored. To now do an about-face and claim that it was never their role to monitor lvrs is an absolute joke! What the hell do they think they were being paid to do???

I find their "poor memories" and prevaricating to be totally abhorrent. Surely it must now be clear to even their most die-hard loyal followers that these people are nothing but ruthlessly self-serving charlatans. Sociopaths of the economic variety.

Gee whiz this ranting is good for the soul

 

[Ironhalo]

I was told repeatedly that 'we watch the market for you to stop you from doing anything crazy based on either greed or fear.'

So what were we paying them for exactly? You can throw money in an ASX200 index fund for about $29.99 brokerage fees on Comsec, and arrange a margin loan in about 2 hours with a bank.

Funny how they could monitor the market well enough when they were making profits. I remember one night in Sydney I had a late appointment with my advisor and I could see some of the staff cracking open some drinks and champagne. I asked what the go was and he said 'oh the market went up 4% today'.

 

[Solly]

A brave showing from an ex-cane farmer at the hearing today. It must be very hard publicly bearing your financial predicament.

I wish you good luck Mr Milburn.

 

[clayton4115]

unfortunately, history repeats itself and it will happen again, the only way to stop this is to ban commissions only, and i say this as a financial planner myself,

i just could not even THINK to put my clients in such a high risk strategy, i mean they place all the trust in you,

these two should rot in hell!

 

[Solly]

"It's not the end of the world: Storm boss"

"A former north Queensland cane farmer says Storm Financial founder Emmanuel Cassimatis assured him he had "nothing to worry about" when borrowing hundreds of thousands of dollars to invest in indexed funds.

Mackay maintenance fitter Bruce Milburn, who has been left nearly $300,00 in debt, took the stand in the Federal Court in Brisbane today to outline his dealings with the collapsed advisory firm and its predecessor, Cassimatis Securities.'

More by Daniel Hurst in Business Day on brisbanetimes.com.au here;

http://www.brisbanetimes.com.au/business/its-not-the-end-of-the-world-storm-boss-20090930-gbyx.html

 

[Solly]

'Storm's gain was client's pain"

"STORM Financial advised a client to move his money from one fund to another, charged him $7000 to do so, and there was no discernible benefit to his portfolio."

More by Anthony Marx in the Courier Mail here;

http://www.news.com.au/couriermail/story/0,20797,26146197-3102,00.html

 

[Anastasia]

I had a bit of a "downer" last weekend when everything just seemed too hard...I just felt so exhausted and alone... and I posted how I felt on ASF.

Well.....I have come through the other side thanks to the many ASF posters who sent me PM's and posts on ASF to "hang in there" and offer me wise words of wisdom, encouragement, and just letting me know you cared. So a very big Thank You.

I am indeed lucky to be a part of a forum with such amazing, compassionate friends.

For the record, the script for antidepressants is still in my handbag. But alas the honoured bottle of Shiraz I was saving for the end of this Storm catastrophe has been cracked open to toast you all. Cheers everyone.

 

[GumbyLearner]

I had a bit of a "downer" last weekend when everything just seemed too hard...I just felt so exhausted and alone... and I posted how I felt on ASF.

Well.....I have come through the other side thanks to the many ASF posters who sent me PM's and posts on ASF to "hang in there" and offer me wise words of wisdom, encouragement, and just letting me know you cared. So a very big Thank You.

I am indeed lucky to be a part of a forum with such amazing, compassionate friends.

For the record, the script for antidepressants is still in my handbag. But alas the honoured bottle of Shiraz I was saving for the end of this Storm catastrophe has been cracked open to toast you all. Cheers everyone.
View attachment 33626

Good to hear Anastasia.

Just remember this, a good academic friend of mine reminded me of this both timeless and famous quote the other day

We must always be on guard against...

The Guides, the Wardens of our faculties
And Stewards of our labour, watchful men
And skillful in the usury of time,
Sages, who in their prescience would controul
All accidents, and to the very road
Which they have fashion’d would confine us down,
Like engines….

Woodsworth, The Prelude

 

[Garpal Gumnut]

I'm glad you are feeling better Anastasia.

It appears many of the banks have come to the party on ensuring people will not lose their homes.

Manny is smarter than I thought and has survived the Financial Inquiry and the Federal Court investigation by Worrells the liquidators. Guys in as much **** as Manny and Julie cannot put on the smirks and smiles they had yesterday without having some aces up their sleeves.

SICAG with some of their major minds being advisers who got the poor Storm victims into the stumpf they are in, have been very slack in not going for Manny, instead of the banks. They still have a plug for the Storm fee model on their website, last time I looked.

Scattini from Slater and Gordon had done the banks for them anyway (going for the the banks and making them accountable). Speaking to Stormers they feel very let down by SICAG.

So it remains only for the weak as piss ASIC and the small matter of the $2 million taken from Storm in its dying minutes by the Cassimatises to trip Manny up.

My bet is that he will get clean away, as all the other pied pipers of Australian financial disasters have.

And the reason is, that he is smarter than all the agencies lined up against him. Manny is selling snow to Eskimos again.

gg

 

[GumbyLearner]

So it remains only for the weak as piss ASIC and the small matter of the $2 million taken from Storm in its dying minutes by the Cassimatises to trip Manny up.

My bet is that he will get clean away, as all the other pied pipers of Australian financial disasters have.

And the reason is, that he is smarter than all the agencies lined up against him. Manny is selling snow to Eskimos again.

gg

Well said.

This is the problem.

In my honest opinion, they should buy some roids and grow some teeth if they are lacking in them!

 

[Judd]

.....My bet is that he will get clean away, as all the other pied pipers of Australian financial disasters have.

Aww, Ray Williams did 2 1/2 years scrubbing the toilets and Rod of Adler fame did a little bit of time. Rod's mate Brad had a looksee at the blank walls for a while as well.

As for lapses of memory in court, let's admit that a certain former female Premier of WA and former Federal Labor MP, appears to have been able to outshine them all in the "I don't remember" stakes. However, it must be said that she was acquitted, by the jury, of lying to a Royal Commission.

 

[GumbyLearner]

Aww, Ray Williams did 2 1/2 years scrubbing the toilets and Rod of Adler fame did a little bit of time. Rod's mate Brad had a looksee at the blank walls for a while as well.

As for lapses of memory in court, let's admit that a certain former female Premier of WA and former Federal Labor MP, appears to have been able to outshine them all in the "I don't remember" stakes. However, it must be said that she was acquitted, by the jury, of lying to a Royal Commission.

ROFLMAO! From the boardrooms of power to the obsequious warm-lettuce face slapping of the Crown.

Well said.

Just never do that again!! Or we will scold your face with a warm piece of out of season lettuce! Totally ridiciulous. But hey, that's the UMPIRE!

:iamwithst

 

[GumbyLearner]

Anyone need a goorkha

 

[Julia]

I'm glad you are feeling better Anastasia.

Me too, Anastasia. So good to hear and thank you for letting us know.

It appears many of the banks have come to the party on ensuring people will not lose their homes.

Manny is smarter than I thought and has survived the Financial Inquiry and the Federal Court investigation by Worrells the liquidators. Guys in as much **** as Manny and Julie cannot put on the smirks and smiles they had yesterday without having some aces up their sleeves.

I don't think they will have fooled anyone, gg. Let's wait for the eventual comments from Worrells and ASIC. Then there are the results of the parliamentary enquiry to come.

I'd have thought Manny and Julie would have scored more brownie points with their interrogators if they'd simply been honest and said they misjudged the whole situation. To expect anyone to believe, e.g. that Manny couldn't remember whether he was managing director or not, or why the share float failed simply makes them look like the liars and thieves they are.

My bet is that he will get clean away, as all the other pied pipers of Australian financial disasters have.

I very much hope not. Even the ignominy of a short jail sentence would offer much satisfaction to stormers.

The changes served no discernable benefit other than to net Storm a fee of about $7000 - and also exposed him to capital gains tax.

Mr Milburn was a Storm investor since 1999, and at its peak his portfolio was worth $7m.

But Storm's collapse has wiped him out and he now has a margin loan debt of $300,000.

Why on earth did he need more than $7m? Why wouldn't he have sold out at that stage?

Many Stormers have said they invested with Storm just so they wouldn't be dependent on the government pension. I absolutely understand that.
But I do not understand why $7m - even invested in the most passive way -would not have earned a retired farmer enough to live on.

 

[GumbyLearner]

But I do not understand why $7m - even invested in the most passive way -would not have earned a retired farmer enough to live on.

Julia

You are a good person.

These people are offended by your evaluation! Seriously offended!

Let's rock!

Cheers
G.

 

[Julia]

Julia

You are a good person.

These people are offended by your evaluation! Seriously offended!

Let's rock!

Cheers
G.

Who is offended, Gumby? Manny and Julie; or the retired, once was worth $7M, farmer?

 

[GumbyLearner]

once was worth $7M, farmer?

Well maybe someones eyes got TOO BIG for their stomach?

 

[Steve Borden]

once was worth $7M, farmer?

Am guessing but if the portfolio was worth $7m, less say a margin loan at 60% ($4.2m) less some home loans and/or a commercial loan against the farm he probably had about $1m in equity less some CGT. So he might have walked away with maybe $800k and some unencumbered property.

Apparently this would still not have been enough to live on if you talked to a Storm salesperson.