Re: ASIC / CLASS ACTIONS / STORM FINANCIAL
This matter has been bubbling along for some time now:
http://www.lawyersweekly.com.au/news/principal-warns-against-asic--1-
It's fun isn't it?
There are ALWAYS three POTENTIAL options for recovery:
1. The manager/receiver brings an action on behalf of the fund (with or with a litigation fund);
2. Members get together in a class action; and
3. ASIC comes along and sues on behalf of members.
Members are able to bring a class action (3), but there's a cost - from 25% to 40% of proceeds plus recovered costs, the percentage may increase over time, and on appeal. This path is sure but access to evidence is not sure.
The manager/receiver might bring an action on behalf of members - this is not sure, but possible - sometimes the manager might want a slice of the action (eg. Trilogy's proposals to PFMF members on 1 September 2010 included an attempt to grab 20% of any future proceeds - see http://www.moneymagik.com/general_information.php). The fund may have to outlay costs (no litigation funder) and the fund may assume the risk (no litigation funder), but on a win, the outcome is much much better for investors if the fund runs the matter without a litigation funder. The fund will recover legal costs. Access to evidence is not a problem.
ASIC might bring an action against certain parties including certain directors, but might not seek damages for members of the fund, and the other hand, it might (see Storm - it may, it may not). This path provides maximum return for investors, with zero outlay. Whether investors are able to have confidence in ASIC is quite another thing altogether - ASIC might not proceed as far as investors might like it to.
What do you do? Do you join up with a class action and pay a fee? Do you wait for the manager/receiver to make a decision? or do you wait for ASIC?
What do you do if you join up with a class action, and then ASIC comes along? of if the manager/receiver comes along?
What do you do? There is no certain path, but there SHOULD be. This should not be a guessing game - it should be certain - but, it's not!
This matter has been bubbling along for some time now:
http://www.lawyersweekly.com.au/news/principal-warns-against-asic--1-
It's fun isn't it?
There are ALWAYS three POTENTIAL options for recovery:
1. The manager/receiver brings an action on behalf of the fund (with or with a litigation fund);
2. Members get together in a class action; and
3. ASIC comes along and sues on behalf of members.
Members are able to bring a class action (3), but there's a cost - from 25% to 40% of proceeds plus recovered costs, the percentage may increase over time, and on appeal. This path is sure but access to evidence is not sure.
The manager/receiver might bring an action on behalf of members - this is not sure, but possible - sometimes the manager might want a slice of the action (eg. Trilogy's proposals to PFMF members on 1 September 2010 included an attempt to grab 20% of any future proceeds - see http://www.moneymagik.com/general_information.php). The fund may have to outlay costs (no litigation funder) and the fund may assume the risk (no litigation funder), but on a win, the outcome is much much better for investors if the fund runs the matter without a litigation funder. The fund will recover legal costs. Access to evidence is not a problem.
ASIC might bring an action against certain parties including certain directors, but might not seek damages for members of the fund, and the other hand, it might (see Storm - it may, it may not). This path provides maximum return for investors, with zero outlay. Whether investors are able to have confidence in ASIC is quite another thing altogether - ASIC might not proceed as far as investors might like it to.
What do you do? Do you join up with a class action and pay a fee? Do you wait for the manager/receiver to make a decision? or do you wait for ASIC?
What do you do if you join up with a class action, and then ASIC comes along? of if the manager/receiver comes along?
What do you do? There is no certain path, but there SHOULD be. This should not be a guessing game - it should be certain - but, it's not!
There was a famous incident between the two at Capital Bar in Main Beach where McIvor ran out of the place with his tail between his legs after a few choice words from Bob. Good on ya Bob you saw the writing on the wall way back then, that's why your a success and McIvor is an abject failure and laughing stock of the Gold Coast...