Australian (ASX) Stock Market Forum

LM Investment Management - Lack of confidence

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Re: It's been a week!

am262327 said:
Anybody have any clue why it's taking so long for the judge to give her opinion on this case?
Click to expand...

The latest info available is on the LM website, under FMIF . Having already asked FTI how long it may take they only said it could take some time as Judge had a lot of material to consider (refer Affadivits) I guess we will just have to wait and hope the Judge makes the best decision for ALL INVESTORS
 
Looks like another court hearing at 9am tomorrow - Wednesday - at Supreme Court Brisbane. Could this be the judgement? Thought FTI were going to let us know on their website but typically, investors not informed. Why am I surprised?
 
FTI have been busy

On the back of the depressing news that Drake took a personal loan in March just as the finances were drying up (again, I ask, what is ASIC doing about this!), I hope this court case takes us from the financial side of the story to the brazen criminal one.
 
"... the collapse of the company cast serious doubts on Australia's reputation as a safe haven for investment."

Not just this cowboy outfit, but so many others too. It's only when you delve into what has been going on with the Gold Coast dodgy developers that you find out that this type of thing has been going on for years.
Shame on the Aussie government and ASIC for allowing it, and shame on the IFAs who were a party to it.

"...Drake gave himself a $26 million loan before his funds empire collapsed... possibility of untoward activity, saying payments of $157,750 were made to a Hong Kong bank account... "Peter Drake may have withdrawn some of those funds personally" ...$333,048 had been transferred from LMA to a Fiji bank account..."

Sounds like Wishee Washee's Chinese Laundry has been busy.

"FTI said it also had uncovered evidence the company may have traded while insolvent and that some LMIM directors may have committed offences prior to their appointment."

It's about time they all had their collars felt. But who's going to do it - the Aussie Feds? Go get 'em boys.
 
Gov't Bailout?

The Aussie Feds? Go get 'em boys.
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Seeing as though this story is getting a lot of attention in the public, and also seeing as though the financials of this story has pretty much played itself out (or nearly out), I would like to put something out there.

What are the chances of the Australian government taking notice of this problem? LM was a high profile company, the MPF was its flagship, and it has turned out that the optimistic narrative is that they epicly mismanaged the funds, the pessimistic one is that Drake and his Directors are fraudsters.

Yes, I'm asking a serious question, because under either of those two options the gov't is the biggest loser in this.

Because, if this sort of thing happened in my country, the USA, this would get a lot of play from politicians. We also went through a period where oversight was lacking, to say the least, and we bailed them out when the bubble popped. This isn't exactly a bubble popping, but it's worse, because, from where I'm sitting, I should never have been able to buy from MPF.

I'm not an Australian citizen, so I'm not subject to its securities laws. The MPF is not regulated, so it's not subject to any securities laws. By the way, if any of those two statements are incorrect, do tell me.

I mean, this is a crazy story. Why aren't politicians out there taking advantage of it? What's in it for them?
 
Re: Gov't Bailout?

am262327 said:
What are the chances of the Australian government taking notice of this problem? LM was a high profile company, the MPF was its flagship, and it has turned out that the optimistic narrative is that they epicly mismanaged the funds, the pessimistic one is that Drake and his Directors are fraudsters.

Yes, I'm asking a serious question, because under either of those two options the gov't is the biggest loser in this.
Click to expand...

I'm not sure what you expected the government to do here.
If its fraud, the auditors signed off on all the accounts. How are the rest of us supposed to know if fraud is going on or not if all of the auditors are happy to continually tick the box.
If its incompetence, well you can't ban incompetence. If you could, 66% of CEOs and 90% of politicians would be out of a job.

am262327 said:
Because, if this sort of thing happened in my country, the USA, this would get a lot of play from politicians. We also went through a period where oversight was lacking, to say the least, and we bailed them out when the bubble popped. This isn't exactly a bubble popping, but it's worse, because, from where I'm sitting, I should never have been able to buy from MPF.

I'm not an Australian citizen, so I'm not subject to its securities laws. The MPF is not regulated, so it's not subject to any securities laws. By the way, if any of those two statements are incorrect, do tell me.

I mean, this is a crazy story. Why aren't politicians out there taking advantage of it? What's in it for them?
Click to expand...

I'm not sure what you are talking about here. The USA has never bailed out an investment fund. They have bailed out banks and insurers before, but its usually on the grounds that letting a bank or insurer fail would lead to system failure because of all the counterparty exposures they have with each other. In most of those cases, the shareholders got wiped out.

As for you should not have been able to invest in the MPF... while I don't think ASIC is blameless, I think you're largely barking up the wrong tree. LM has always had a very focussed business model that was centred around the financial planner market. Unlike say MFS, LM does not take money from mums and dads directly. If you had money with LM, then your financial advisor put you there. You should be asking your financial advisor questions like:
1. Why have you invested my money in a small mortgage fund manager in the Gold Coast that no one has ever heard of.
2. Why would you put my money in MPF when LM's flagship, the FMIF, was frozen back in 2009 and is a sorry basket case?
3. What independent research did you do on LM? 2 day conferences to the gold coast paid for by LM to watch a powerpoint presentation don't count as independent research.
4. What self respecting professional fund manager pays 1%+ trail commissions to advisors? that's the kind of shenanigans you used to get in the agribusiness sector.
 
Re: Gov't Bailout?

The investors of the LM Performance Fund need to band together and write to the
Australian Prime Minister and state that the Australian government needs to bail us
out.
I am writing from Canada and the Canadians authority and the Canadian Press will
definitely be informed and pressure will be put on Canadians from not investing in Austalia
especially the Ontario Teachers Pension Fund and all other pension funds.

I can't believe that Drake and the other Directors are not in jail for fraud???
 
Re: Gov't Bailout?

No offence DUBAI, but you need a reality check. That's not going to happen.

There is no doubt this is a disaster and Drake needs to be spoken to by the authorities. No doubt that we have been cheated out of our money by an idiot or a conman. By someone who has shafted us all and who may well get away with it. If those money movements to bank accounts here and there are true, well, you don't need me to tell you how that will stick in my throat, probably for the rest of my life.

I'm not sure who is going to help us. We have been shafted my friend.

So where are you now Mr Drake? I mean haven't you got the balls to say something as we stare financial ruin in the eye? Are you spending my money as we speak in Fiji or wherever the f*&k you have scurried off to.

Do you realise you have destroyed, I mean DESTROYED people?
 
Re: Gov't Bailout?

DUBAI said:
The investors of the LM Performance Fund need to band together and write to the
Australian Prime Minister and state that the Australian government needs to bail us
out.
I am writing from Canada and the Canadians authority and the Canadian Press will
definitely be informed and pressure will be put on Canadians from not investing in Austalia
especially the Ontario Teachers Pension Fund and all other pension funds.
Click to expand...

No offence, but that's a pretty stupid post. Would you stop investing in the US because they had Bernie Madoff?

And Australian taxpayers aren't going to bail out an investment fund, especially one that doesn't even have a PDS registered in Australia. Its not a government guaranteed investment. If you wanted a guarantee you should have put your money in a bank term deposit here. They were guaranteed during the GFC.
 
I wouldn't invest in the US precisely because I have heard about Bernie Madoff and his Ponzi scheme. I don't trust the US stock market, the US banks, or any US financial institution anyway.
I also wouldn't invest in land banking in Canada as suggested by my IFA. A title deed to a patch of tundra could easily be worth about a much as a nice plot on the moon.
I also wouldn't become involved with Multi-Level-Marketing, Pyramid Sales or Timeshare investments. That's because we have long been warned about all of these schemes as rip offs.

The issue must be that the level of bad publicity as got to be raised, to warn other gullible fools (or "unsophisticated investors" in the trade) to not risk investing in Australia in general, Gold Coast property in particular, and unregulated mismanaged funds especially. The whole world should be warned about the high risks involved here, but nobody had done prior to LM's collapse and nobody is doing yet. LM, the IFAs, and the Aussie authorities kept it all quiet and are still largely ignoring the issue. Why did it take from mid-2008 until March 2013 for something to happen, while MPF investors were still being conned?

Although the funds and financial services claim to be heavily regulated, it's pretty obvious that ASIC are totally useless. How did they permit this whole sorry mess to carry on for so long, then explode and melt down? I agree there is no hope of the Aussie taxpayers bailing out an investment fund and there were no guarantees, but there should still be some serious ramifications to come out of this.

Many investors are expats, just looking for a safe investment somewhere for something that would out perform cash rates. But remember that the majority of early investors were Aussie & Kiwi retirees. The FMIF and it's feeder funds were regulated funds under ASIC rules, and were pushed by LM and their IFAs as very safe and regulated "just like a bank". There are thousands of those Australian investors, with their 'Super' and pensions now gone, who have also been stung by Drake & Co. If they were more vocal and received more publicity, with support from Aussie politicians, perhaps there could be at least some action to sort out the broken Aussie financial system and the sharks swimming in it.
 
am262327 said:
I'm not sure what any of that means, does anybody else?
Click to expand...

Suncorp have sold the title deeds for Maddison, as first mortgagee they got their dosh back, as second mortgagee, the MPF fund investment of say $250m is and always was worthless hence my comments.

If I am reading this wrong then please put me right.

The MPF Fund has no assets that are worth anything of real value, certainly nearer $500 than $500m!

Kordamentha and FTI will be the only winners in this debacle.
 
Suncorp sold their loan, not the title deed. According to the weekend newspaper Sunland paid less than 80c in the dollar, so let's say $17.6m for the $22m reported face value. If Sunland take possession of the property and sell it, they would be entitled to the first $22m + expenses with MPF getting anything above that.

It can't be a good sign for the valuation of Maddison estate if Suncorp are supposedly in the box seat and still willing to take a 20% loss just to get out. Ideally you'd want the second mortgagee (MPF) to take out the first mortgagee to protect their position and maximise a return by further developing the property. However, can you imagine the cheek of a financial adviser going back to their client and asking for more money to put in the MPF.
 
bigheadache said:
However, can you imagine the cheek of a financial adviser going back to their client and asking for more money to put in the MPF.
Click to expand...

Nice 'tongue in cheek' comment.
They have already done that, for a whopping 10 to 15% of your investment more!

For anyone who has not heard of the ACI (Advisor's Committee for Investors), they're here for another bite at the cherry.
 

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