BCS - BrisConnections Unit Trusts

prawn_86 · 18 December 2008

Re: Brisconnections shareholders - financial ruin

As with cuttlefish, i like ROEs idea, but it isn't really feasible.

I cant remember who said it, but to me, the best sounding option is getting some generous sole, who has no intention of being a company director in the future, to start a limited liability co, do a heap of off market buying of all those here at ASF and then declare the company bankrupt.

Perhaps one of you holders could look into doing that, or getting a friend to do it...

doctorj · 18 December 2008

Re: Brisconnections shareholders - financial ruin

If people want to help those suffering through all this, donations for legal fees would probably be the best use of funds, rather than sharing the BCS liability.

Julia · 18 December 2008

Re: Brisconnections shareholders - financial ruin

sails said:
Hey Bushie - there will always be differing opinions on a forum like this - that's what it's all about. But there are some of us who sincerely hope for a good outcome for those trapped in this extraordinary situation.

Prospector said:
I have been sharing this thread with my family in absolute horror about how easily people have become enmeshed in this. And sometimes I think that there but for the grace of god go I!. Not that he/she delivers me any favours, it is just the meaning of the saying. My fervent wish for all of you who are trapped at the moment is that come the New Year, there will be a good solution for you. I think there will be, but I really do feel for you while things get themselves sorted. Ignore those who are not offering you support, I am a great believer in Karma. All the best!

Bushie, I echo what Sails and Prospector have said above. I can't begin to imagine how frightening your situation must be.

However, I just can't see that it would be cost effective for Macquarie etc to pursue all the small holders, many of whom will have nothing to sell. I'd guess that as underwriters they'll just have to fulfil their obligations.

The situation is not too dissimilar to Storm Financial. Slater and Gordon appear to be onto this.

Bushie, I guess all you can do at this stage is follow the advice of the ASA who clearly are not going to give up on this.

And ignore the remarks of those ASF members who probably need to make themselves feel good by criticising others. As Prospector said, there is eventually karma.

thermalmonster · 19 December 2008

Re: Brisconnections shareholders - financial ruin

Does anyone have any Idea of the Number of shareholders that are affected by this.?

rocket12 · 19 December 2008

Re: Brisconnections shareholders - financial ruin

thermalmonster said:
Does anyone have any Idea of the Number of shareholders that are affected by this.?

There would be a few hundred of us. Check your private messages then email me if you want to join in.

Enzyme · 19 December 2008

Re: Brisconnections shareholders - financial ruin

It is hard to say.

I think it is possible to request a copy of the shareholders registry from the Brisconnections. That would give you a list of their shareholders with their contact details. That might be worthwhile, as you could arrange a mailout to get in contact with all shareholders and try to coordinate a response.

I do think there are a lot of people affected. I've read that in November, 80% of all stock on issue changed hands. That was a mass transfer of shares from the big institutional investors to small retail investors.

Julia · 19 December 2008

Re: Brisconnections shareholders - financial ruin

Rocket, would it be a better option to check with, e.g. Slater and Gordon, or one of the other legal firms who are known for this sort of action, see if they're up for it, and get them to do the publicity? What do the ASA advise?

rocket12 · 19 December 2008

Re: Brisconnections shareholders - financial ruin

Julia said:
Rocket, would it be a better option to check with, e.g. Slater and Gordon, or one of the other legal firms who are known for this sort of action, see if they're up for it, and get them to do the publicity? What do the ASA advise?

S & G only sue people, we need to prove we dont have a liability. I have discussed with several lawers who feel confident about this but I don't want to go the expense on my own. I have contacted Maurice Blackburn but they are taking their time getting back to me.

Sunder · 19 December 2008

Re: Brisconnections shareholders - financial ruin

cuttlefish said:
It still astounds me that this land mine is sitting there on the market, not suspended, waiting for an unassuming victim to buy another $500 of stock and assume $1 miillion dollars worth of nightmare.

Why this stock hasn't been suspended is beyond me.

Probably because of one or more of the following:

1. Suspending the stock solely for that reason is a tacit admission that regulations were inadequate. Either they're not willing to admit that, or they don't think so.

2. Suspending it means that the sellers are even more stuck, and may sue ASIC for suspending trade on a "viable" stock.

3. ASIC does not have the legislated authority to suspend trading on a stock for this particular reason.

4. ASIC believe this is a small, uneductaed investor problem, and does not believe affecting the whole market for this share is an effective method of dealing with the problem.

cuttlefish · 19 December 2008

Re: Brisconnections shareholders - financial ruin

Sunder said:
Probably because of one or more of the following:

1. Suspending the stock solely for that reason is a tacit admission that regulations were inadequate. Either they're not willing to admit that, or they don't think so.

2. Suspending it means that the sellers are even more stuck, and may sue ASIC for suspending trade on a "viable" stock.

3. ASIC does not have the legislated authority to suspend trading on a stock for this particular reason.

4. ASIC believe this is a small, uneductaed investor problem, and does not believe affecting the whole market for this share is an effective method of dealing with the problem.

The ASX is within its rights to suspend a stock if the believe they need to do so in order to prevent a disorderly market. With 100 million shares on the offer, and zero shares on the bid, and the stock sitting at the lowest possible price increment of .001, and with $2 still owing on the stock, I would have thought there is a strong argument that proper price discovery is not possible at the moment in this stock at this price point and thus there is not an orderly market.

They would really need to allow the stock to trade at a negative price in order to create an environment that would allow true price discovery in my opinion.

My understanding is that suspension of a stock is within the ASX's regulatory domain (i.e. they don't need ASIC involvement).

It is also possible for a company to request that their stock be suspended, so there is also no reason why BCS can't request a suspension as well.

rocket12 · 19 December 2008

Re: Brisconnections shareholders - financial ruin

cuttlefish said:
The ASX is within its rights to suspend a stock if the believe they need to do so in order to prevent a disorderly market. With 100 million shares on the offer, and zero shares on the bid, and the stock sitting at the lowest possible price increment of .001, and with $2 still owing on the stock, I would have thought there is a strong argument that proper price discovery is not possible at the moment in this stock at this price point and thus there is not an orderly market.

They would really need to allow the stock to trade at a negative price in order to create an environment that would allow true price discovery in my opinion.

My understanding is that suspension of a stock is within the ASX's regulatory domain (i.e. they don't need ASIC involvement).

It is also possible for a company to request that their stock be suspended, so there is also no reason why BCS can't request a suspension as well.

Have to agree with Sunders first 3 points. The stock cant be suspended, would open up an even bigger can of worms.

Cobber · 20 December 2008

Re: Brisconnections shareholders - financial ruin

rocket12 said:
Not sure why your talking about emails. When you buy the shares online there is a buy page (take a look at the screencaps on page 2 of this thread) that tells you how much the trade is going to cost you. All they have to do is tell you that instead of the trade costing you $2k it's going to cost you $4 million. I think that might of influenced to not click the buy now button.

I agree with this. Most things these days when you sign up online come with a box saying to read the terms and conditions and then you wither agree or don't agree. If this was done all of the problems would be solvered.

Cobber · 20 December 2008

Re: Brisconnections shareholders - financial ruin

thermalmonster said:
I bought them through Comsec.

As soon as I found out about the 2 further installments I of course Listed them for sale, with the other investors.
I agree with Sail on this.
If there was a market for them we would all sell them

Surley any judge in his right mind will serve the correct justice in this matter.
Obviously if so many people have fell foul of this then proper documentation was not in place.
I also cant understand how you can enter a financial binding arrangement in excess of $1million dollas without signing a single document or having a credit check to see if you are worthy. Talk about Risky Lending!!!!! Isnt this why the Global Financial crisis is upon us??
I wouldnt be able to borrow 10 bucks from commonwealth bank witout at least signing somthing

The whole thing Stinks and its about time someone in the Government stepped up to this and sorted it out.

I've done exactly the same as you. I had no idea what I was in for until I received a letter saying thank you for becoming apart of this. I would have thought I would have to sign a legally binding document. Surely they are just going to end up chasing more and more people who can't meet their demands and they will fall flat on their face with no money.

Cobber · 20 December 2008

Re: Brisconnections shareholders - financial ruin

Hi All

I have read through a lot of this stuff and I'm a bit confused as to what is being done to resolve the issue. Are we all just talking around in circles responding to each other or is someone taking control and going forth with ideas. I am one of those fools that got trapped. I have very little knowledge of the market but got put on to etrade a few yrs ago by a friend. I thought buying shares for 0.001 at a minimum trade of $500 posed little risk and maybe I could double my money to help pay off my credit card. There were plenty of shares being bought and sold at the time. I have only just discovered what I got myself into once a letter arrived thanking me for becoming apart of Brisconnections and then it outlined my next obligations. Now the nightmare has begun. The true reality hit when I discovered these are speciality shares that etrade is not allowing to be traded online but only over the phone via manual order. I have busted my balls for years trying to keep my head above water with my home loan. I can't stand the thought of losing my home that I have worked so hard for. what can we do... I need help! I wouldn't have thought chasing petty people like me would be worth Macs efforts. I also can't believe I can get my self into something so legally binding without signing and agreeing to terms and conditions. There aren't many things you can do without signing for, so how can one get themselves into a situation of owing millions of dollars without signing for it.

Julia · 20 December 2008

Re: Brisconnections shareholders - financial ruin

Cobber said:
Hi All

The true reality hit when I discovered these are speciality shares that etrade is not allowing to be traded online but only over the phone via manual order.

I was surprised to read this so have just done a Buy order (without of course taking the last step) and there wasn't any indication that the usual online order wasn't OK.
Where did you get the info that you could only place phone order?

Btw, there's an article in today's Courier Mail (Brisbane) that the Brisconnections work is going ahead.

rocket12 · 20 December 2008

Re: Brisconnections shareholders - financial ruin

Cobber said:
Hi All

I have read through a lot of this stuff and I'm a bit confused as to what is being done to resolve the issue. Are we all just talking around in circles responding to each other or is someone taking control and going forth with ideas. I am one of those fools that got trapped. I have very little knowledge of the market but got put on to etrade a few yrs ago by a friend. I thought buying shares for 0.001 at a minimum trade of $500 posed little risk and maybe I could double my money to help pay off my credit card. There were plenty of shares being bought and sold at the time. I have only just discovered what I got myself into once a letter arrived thanking me for becoming apart of Brisconnections and then it outlined my next obligations. Now the nightmare has begun. The true reality hit when I discovered these are speciality shares that etrade is not allowing to be traded online but only over the phone via manual order. I have busted my balls for years trying to keep my head above water with my home loan. I can't stand the thought of losing my home that I have worked so hard for. what can we do... I need help! I wouldn't have thought chasing petty people like me would be worth Macs efforts. I also can't believe I can get my self into something so legally binding without signing and agreeing to terms and conditions. There aren't many things you can do without signing for, so how can one get themselves into a situation of owing millions of dollars without signing for it.

Hi, send me a private message by clicking on my profile name and give me your email address, we are getting of many of us together who have been trapped this way. In the new year when the lawyers are back at work we will look at a group action.

Did you buy the shares online with edtrade?

Prospector · 20 December 2008

Re: Brisconnections shareholders - financial ruin

Hey Julia, you were braver than me - I didnt trust my touchpad not to ping off a trade.

We are trying to get our minds around the liability that people are now under. For someone who purchased $500 worth of shares, exactly what is the debt you are now looking at?

I cant believe there is no warning; NAB online warns you that shares you are about to purchase are ex-dividend, how can they possibly not warn people that buying these shares creates a liability?

Once again, I am hoping for an excellent outcome for you all; it beggars belief that someone is not doing something about this situation. I cannot imagine that this could possibly be enforced. All the best.

rocket12 · 20 December 2008

Re: Brisconnections shareholders - financial ruin

Prospector said:
Hey Julia, you were braver than me - I didnt trust my touchpad not to ping off a trade.

We are trying to get our minds around the liability that people are now under. For someone who purchased $500 worth of shares, exactly what is the debt you are now looking at?

I cant believe there is no warning; NAB online warns you that shares you are about to purchase are ex-dividend, how can they possibly not warn people that buying these shares creates a liability?

Once again, I am hoping for an excellent outcome for you all; it beggars belief that someone is not doing something about this situation. I cannot imagine that this could possibly be enforced. All the best.

A $500 purchase will give you a total 1 million dollar debt. Someone bought $100 worth during the week, which will give them a 2 hundred thousand debt.

I think when you see it with your own eyes as you have done with NAB online and via the screencaps I have shown, anybody with a morsel of an idea as to whats right and wrong can see that this is just too rediculous to be true. As Bushie mentioned it's actually surreal to hear Trevor Rowe stating categorically that they are going to pursue this all the way...I just hope and pray to wake up one morning to news that they have come to their senses and I can started living again...

Sunder · 21 December 2008

Re: Brisconnections shareholders - financial ruin

rocket12 said:
As Bushie mentioned it's actually surreal to hear Trevor Rowe stating categorically that they are going to pursue this all the way...

Think outside your own shoes for a moment and ask what options he has?

1. He doesn't pursue the debt. Macquarie is then excused from their liabilities, and the government sues Brisconnections because no road was built. Likely shareholders who were intending to come good on their portion will also sue him for wiping out their company.

2. He only selectively pursues the debt for people likely to have more money than the costs it to recover it. It only costs a couple hundred dollars to send a debt collector, and I was told around $10k to take it "to the end". (All the way through the courts) Do you seriously think most people who trade shares have less than $10,001 of recoverable assets? If Macquarie can assert that "all avenues" were not exhausted in attempting to recover the money, they refuse to pay out that part of the claim, and we have a smaller version of scenario 1.

3. He does everything by the book, recovers money from those who have it, damages the credit rating of those that don't (possibly to the point of requiring bankruptcy protection), and Macquarie pays the rest. His company goes through smooth sailing, he gets his multi-million dollar bonuses for getting the road get built on time, and he can, in clear conscience say that it's not his fault that people made mistakes on his company's issues.

This is ugly. Very ugly. But if you were him, which would you take?

Bushie · 21 December 2008

Re: Brisconnections shareholders - financial ruin

Sunder said:
Think outside your own shoes for a moment and ask what options he has?

1. He doesn't pursue the debt. Macquarie is then excused from their liabilities, and the government sues Brisconnections because no road was built. Likely shareholders who were intending to come good on their portion will also sue him for wiping out their company.

2. He only selectively pursues the debt for people likely to have more money than the costs it to recover it. It only costs a couple hundred dollars to send a debt collector, and I was told around $10k to take it "to the end". (All the way through the courts) Do you seriously think most people who trade shares have less than $10,001 of recoverable assets? If Macquarie can assert that "all avenues" were not exhausted in attempting to recover the money, they refuse to pay out that part of the claim, and we have a smaller version of scenario 1.

3. He does everything by the book, recovers money from those who have it, damages the credit rating of those that don't (possibly to the point of requiring bankruptcy protection), and Macquarie pays the rest. His company goes through smooth sailing, he gets his multi-million dollar bonuses for getting the road get built on time, and he can, in clear conscience say that it's not his fault that people made mistakes on his company's issues.

This is ugly. Very ugly. But if you were him, which would you take?

Clear Conscience you say Sunder? I wonder how he sleeps at night. He knows that the sh.. has hit the fan & he is still maintaining his upbeat rah rah about the wonderful investment he has, it sounds very hollow now a days. If your scenarios play out, we would become nothing more than a mortgage defaulter & be treated as such with Macquarie instigating forclosure, our own bank gets first chop as 1st mortgage holder & they jointly tear us to shreds, what a lovely thought in the back of one's mind over Christmas, the season of giving.

BCS - BrisConnections Unit Trusts

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