Good morning No Trust.
Is there a link to go with what you've posted?
Typically, LM does not appoint administrators, rather it does the work itself for all those extra $$$$.
See page 5:
http://moneymagik.com/FMIF-financials-30-06-12.pdf
$4,817,414 - "Loan management fees paid to the responsible entity for loan management and receivership services provided by the responsible entity on behalf of the scheme in replacement of appointing external receivers. These fees are charged directly to the borrower to facilitate futher possible recovery."
Of course, if the loans are already impaired then recovery of these monies will be impossible. The $4,817,414 is gone - and the only winner is LM - making money from bad loans that LM itself made. And on top of that, LM made $9,103,864 in management fees.
A frozen fund is surely a "Manager's Delight".
ASICK, LM have appointed administrators to themselves due to concerns of solvency... Reported this morning in the Gold Coast Bulletin. No link yet, however is in the main paper and iPad Edition...
Very similar to Equititrust, I suspect to try and restructure and buy some time...
http://www.stuff.co.nz/business/ind...-campaign-blamed-for-voluntary-administration
Well, no - in my view, not at all like Equititrust. I think it's a move to push Peter Drake (and LM) out of the picture. I've been of the view for some time that the whole LM thing's got very personal, especially the law suit against SMH, and that talk about bathrooms. LM hasn't fared well, and the only option on the horizon is Trilogy: not a good situation for investors.
http://moneymagik.com/three_part_trilogy_funds_management_tragedy.php
If LM didn't have the $$$$ (NTA), it would have to relinquish its managership of the remaining LM funds. Clearly from the BIG $$$ its earned these past years, I don't think its suffering a lack of $$$$s.
Now the voluntary administrators will make decisions about fund assets, and that's a good thing. Decisions will be made "outside the box" (so to speak), and at arm's length to LM's directors.
From my perspective, I think investors might see this as a "sea change", and a much better option than either of Trilogy or LM (as it was).
ASICK, lets agree to disagree on this one... This has all the hallmarks of Equititrust in LM appointing their own "Administrator"... Call me a skeptic, however I believe the strategy between LM and its administrator has already been formulated and it has nothing to do with any benefit for investors... This is all about saving the founder and his precious beachfront bolt holes, and adjoining Skateboard park...
Drake may complain about a smear campaign, however the performance of the funds and the greed in terms of fees speaks volumes. Its a tough world out there and if you don't perform you don't survive...
In situations like this, there is usually a lot more going on in the background which hasn't been fully disclosed "as yet"...
I agree, however he did predict all of this some time ago, read the article below, he was absolutely right:
THE GOLD COAST TRAIN WRECK
http://www.smh.com.au/business/the-gold-coast-train-wreck-20080912-4f4n.html
Well that's the Gold Coast cleaned up now, lets hope that these spiv's like McIvor never resurface...
ABC News coverage and mooted Class Actions which will stymie any hope of LM coming back from the dead. As with Equititrust as soon as the class action was mooted no insurer would touch them... Looks like Drake has entered the perfect storm... This is where reality sets in and the beachfront mansions must go...
Edifices to huge egos and nothing more...
http://www.abc.net.au/news/2013-03-...administration-after-4-corners-expose/4583470
It is estimated that up to $15 billion in savings has been blown up in mortgage funds in Australia, much of it by Gold Coast entrepreneurs such as Drake.
Advertisement
The spiel was simple: invest with us in property. Look at our 8 per cent returns. Can’t go wrong with property – we are talking ‘bricks-and-mortar’. Drake’s salesmen even used words such as ‘bank-like’.
But it was never property that his clients were really buying. As the global financial crisis loomed, they were buying loans to property developers – often associates of Drake and even Drake’s own companies – loans in highly leveraged funds.
The peoples’ savings came in – mostly from financial advisors - and they went out in loans to developers, after the manager LM had taken its clip. And a mighty clip it was too, tens of millions every year in assorted fees, all up.
While most of his investors had their savings frozen with no return, Drake and associates were going for the proverbial doctor on the fee-front.
Not only were the financial advisors still being paid “trailing fees” on their client funds they had already placed in LM – frozen or not – but the banks were making off with penalty interest payments, and LM was ratcheting up its management fees while forking out money on expensive lawyers.
Read more: http://www.smh.com.au/business/when...mbling-down-20130320-2geq9.html#ixzz2O4BCR400
LMIML IS managing funds.
LMIML IS $$$ healthy (it has to be to keep its lincence)
LMIML has a really good income stream.
LMIML funds are not being wound up externally.
Appointing a voluntary adminstrator does not protect Peter Drake from anything - it merely takes the control away from the board of LM and places it in the hands of an adminstrator. Let's face it, if investors aren't satisfied with the outcome, then LM is out, administrator or not. The administrator makes no difference.
Clearly the purpose of appointing an administrator is to take control of both LM and LM's funds away from LM's board and place it in the hands of an independent entity - one which will have to perform to the best of its ability.
Although I'm not an investor in any of LM's funds, I see this as positive and a much much better option to a takeover by Trilogy.
http://moneymagik.com/three_part_trilogy_funds_management_tragedy.php
By the way No Trust, Trilogy's fees from the Pacific First Mortgage Fund are at about $20m, and they returned a whole $0.0875/unit back to investors in nearly FOUR YEARS - and the only option for LM investors was Trilogy! Yipes !!!!!
I think the voluntary adminstrator is a great option for investors, much better than either of LM or Trilogy.
I'm not sure why you think LMIML is $$$ healthy with a good income stream. I thought have thought it would be pretty obvious that a business that actually was $$$ healthy with a good income stream would not be calling in an administrator. Sounds more like having heaps of BDMs and offices around the world was quite an extravagance.
Also.. I'm not sure if you quite understand the role of an administrator. The administrator is there to look after the interests of the creditors of LM, not the unitholders of the fund. Administrators are never long term REs. They'll look to either fix up the business and return LM to RE duties, or if they feel the business is not fixable, they will move to appoint a new RE.
Hi, nice to see you bigheadache.
About the $$$:
http://www.lmaustralia.com/Downloads/documents/inv-LM-announcement-20-03-13.aspx
"All licence conditions of the Responsible Entity have been and continue to be met, and there has been no breach in this regard. The financial requirements (Net Tangible Assets) of the Responsible Entity licence remain in order. The Funds are unit trusts, the assets of which are separate and segregated from those of LMIM."
And of course, there's the (quite considerabale) cash flow generated by (1) management fees, and (2) receiver fees.
As to the role:
http://www.lmaustralia.com/Downloads/documents/inv-LM-announcement-20-03-13.aspx
"The Voluntary Administrators will be working with senior LM investment personnel to optimise investor outcomes."
http://www.lmaustralia.com/Download...lting-Appointed-Voluntary-Administrators.aspx
In relation to the role of the administrator:
"The Board of LMIM advised that the appointment of FTI Consulting was made after full consideration of its obligations as a company and its duties to ensure it acts in the best interests of investors in the LM Funds."
Yes, the administrator will have to make a lot of decisions - who knows what the future is? I certainly don't.
However, given the choice of LM (as it was), and Trilogy (as it is), the outcome (as I see it) is the best in the circumstances.
I think the real problem was with Peter Drake's LM - that was the LM that was struggling, but if I can differentiate LM (the company) from Peter Drake's LM, then the company (LM) is in good order and needs management from someone from "outside the box" to resolve the issues that had clearly become too personal.
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