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Storm Financial Group

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He might go to Majorca! Nudge, nudge, wink, wink, say no more, say no more!
 
"Are banks to blame for the Storm pain?"

"In November last year, Storm founder Julie Cassimatis thought she could still see a way out for Storm Financial and its investors.

"By sticking with your plan (which is in a good position for recovery) and with Storm we will together do the very best to meet your needs both long and short term," Cassimatis wrote to an investor in a letter obtained by the Herald."

More in this article from the SMH here;

http://business.smh.com.au/business/are-banks-to-blame-for-the-storm-pain-20090619-cr5b.html
 
"Relying each day on tranquilisers to deal with a reversal of fortune"

"WITH the nation's biggest lender behind him, and paying top fees for financial advice, Bruce Milburn figured he had the brakes in place to cope with a falling market. He didn't.

The 54-year-old Storm Financial investor now owes about $300,000 to the Commonwealth Bank......"

More by Jacob Saulwick in the SMH;

http://business.smh.com.au/business/relying-each-day-on-tranquilisers-to-deal-with-a-reversal-of-fortune-20090619-cr5n.html
 
"CBA scraps party and braces for Storm"

"Queensland MP and parliamentary committee chairman Bernie Ripoll
....said last night that CBA's announcement on Wednesday that it had "identified shortcomings" in its lending to Storm clients was "a step in the right direction", noting by way of contrast that there were other banks, including Bank of Queensland, Macquarie and ANZ, that were "dragging the chain" in terms of responding to his inquiries."

More by Andrew Main in The Australian...

http://www.theaustralian.news.com.au/business/story/0,28124,25661584-5017978,00.html
 
Garpal Gumnut said:
He is a charming fellow and deserves by his very survival, to continue his valuable financial advisory business in a new company structure. Manny ex Stormers would follow him again I am told.


gg
Click to expand...

gg, during the week one Stormer said exactly that to me, that they would invest again with EC & JC and stated to me that the media has misrepresented many things and that banks had not stood by them in their time of need. I suppose each to their own, it's a free country.....

Just as an aside, where I have previously given support and faith in financial advisory services companies, now after observing the journey in these forums over the past few months I have now wound back my personal exposure to these companies and have found a hands on approach now gives me more control and responsibilty over my own future, financial security and independence. I believe why pay commissions where moderate research and a logical level head will give me bigger gains and greater satisfaction.
 
GG

Congrats on starting this thread which looks to be one of the largest on ASF. I note it has a lot more hits than posts (trolls). Pity it is about such a horribly long train wreck.

There has been a lot of media attention on the banks of late as opposed to EC. This is because we the Australian public did not believe that our banks would be involved in such a fiasco as this. I must say I was impressed by Norris from the CBA coming out and taking control of the situation – admitting they had screwed up and saying they will make it right. This is what we expect from a chairman of such a public institution as the CBA. Yes the fact that a number of internal documents, which were quite damning, were about to hit the media may have prodded the CBA along but the reality is that they could have chosen to stay in the bunker and deny everything (like BOQ) – but they didn’t and this is a good thing for both the bank and the storm victims.

We expect better from our banks. Just go back through this forum and look at the many posts telling storm victims “the banks don’t make mistakes”, “they don’t write off loans”, “give up”, “the only winners will be the lawyers”, and the list goes on and on. Well folks banks do make mistakes - and you WERE WRONG!!!

In terms of EC getting off scot free I would make these points. This is one of the largest financial losses for small investors in Australian history. You don’t lose $3 billion + of small investors funds with such shoddy documentation, flawed models, etc and get to walk away. ASIC are investigating this outside the media spotlight which is what they should be doing in the interests of fairness. I am aware that a number of storm and bank staff have engaged legal counsel to attend the ASIC interviews with them and ASIC have been doing a lot of these formal interviews. I also have been formally interviewed by ASIC and will given evidence if requested at any formal proceedings. The saying the “wheels of justice turn slowly” is very apt but they do turn and the light at the end of the tunnel for many storm and bank staff is a bloody big train. Whatever happens EC has already gone down in infamy!!!

I should also provide some perspective on the CBA announcement. There were 14,000 investors with storm and their investments have all gone up in smoke. The losses to these people are monumental ($2billion +). What we are fighting for impacts only 3,500 storm clients (just 25% of the client base). These are the people who were double geared by storm and the banks using their homes as leverage into a failed financial model. Without the home loans (many of which contained “irregularities”) there was no massive margin loan. What I have agreed to help is to save the family home for these people – their financial losses on the investment portfolio remain and these losses are large. If we are successful in settling these loans then my small involvement will be at an end.

I will, in conjunction with several staff from AEC, be making a punchy little submission to the Parliamentary Enquiry.
 
Hi Solly keep up the great work - i know a lot of the storm victims come on here to keep up with the news through your links.
 

"Emmanual, who once upon a time was affectionately known as "Manny" to his legions of fans, was spotted at the Simon and Garfunkel concert in Brisbane on Wednesday night"

As reported in today's "Financial Review" - page 8, June 20-21, 2009.
 
Below is an extract from a story on one of Solly's links.

While I feel very sorry for Ms Richards, I find it truly amazing that anyone would believe it was 'a no-risk strategy' to take on such a level of borrowing to invest in the stock market.


A $1.48 margin loan on a salary of $45,000
June 20, 2009

TRACEY RICHARDS went to see her Storm Financial planner in February last year. Instead of withdrawing money to buy a motor home, the Brisbane receptionist was persuaded to borrow another $200,000 and invest more deeply in the sharemarket.

It was her third big investment in margin loans through Storm. In 2001 she invested her life savings of $250,000 and later tipped in another $400,000 from the sale of her home.

That is now all gone and she is left with debts of $300,000 she cannot repay.

Ms Richards, a mother of three, has been left suicidal and despairing. The motor home she bought for semi-retirement and a planned trip around Australia has become her permanent residence in a Brisbane caravan park.

Her story has similar threads to many others. Ms Richards, 46, said she was told by her Storm adviser, Stuart Drummond, to ignore the margin calls that came through late last year, with the words: "Don't even talk to the bank; I'm your financial adviser, I'm taking care of it."

There was some talk - which many others heard - that Storm would look after it all, and that after the market recovered, she could repay Storm the money. When the truth finally dawned, the new harsh realities included a Christmas without presents and a sober realisation about the role of Storm.

"I can't describe how awful I felt when my children gave me Christmas gifts and I was not able to give them anything," she says.

"I was in a state of shock. Like a lot of Storm people, we so much believed in them that I didn't really believe he lied to me.

"From my point of view, I thought it was a no-risk strategy.
 
Garpal Gumnut said:
The bright light of investigation will stay on the banks for a while but the Storm "model" was the real cause of the loss of the Stormers capital.
Click to expand...

I agree with GG.

Question - Since when has "loan documentation" been utilised for the purpose of protecting the borrower rather than the lender?
 
bunyip said:
Below is an extract from a story on one of Solly's links.

While I feel very sorry for Ms Richards, I find it truly amazing that anyone would believe it was 'a no-risk strategy' to take on such a level of borrowing to invest in the stock market.
Click to expand...


Further to my post above, if Ms Richards reads this forum I urge her and others like her to consider the considerable potential of her life from here on, rather than dwelling on what's she's lost. As a woman in her mid forties she has a lot of living to do yet and she still has time to set herself up for a comfortable retirement.
Furthermore, her family need her to be around for them.
I can understand that Storm victims are extremely upset, even traumatised by what's happened, but suicide is a poor choice and is unfair to their friends and family.
Some Storm victims are young enough to start again, others have age against them and are facing a life on the pension.
But even life on the pension can be quite enjoyable for people with simple needs and the desire to get in and enjoy what's available to them.

Hang in there Stormers....with or without heaps of money, there are still many things in life that you can enjoy.
 
carey ramm said:
Hi Solly keep up the great work - i know a lot of the storm victims come on here to keep up with the news through your links.
Click to expand...

I do it is my morning and afternoon read with a cuppa. Live in the country and too far to drive just to pick up a newpaper. Good work Solly!
 
well its been another exciting week here-im running out of my money trying to read all the posts and news storys. i cant believe that the cba has said they havent been perfect-gee who would have thought that-?? im not saying that i think things are going to turnout allright but it gives a bit of hope- Mr C and the banks-what ever went wrong you guys have to really sort this out. im no leagl eagle but when something like this stuffs up there alweays a cause. like if i dont put oil in my car it runs ok for a while but then the motor blows up. but the cause of the breakdown was me not putting oil in the engine. somebody was letting storm run on a dry sump-so whiose fault was it??- im all for assic and the inquiryes let them roll-we just want our money and houses back- just like what we had before this mess happened. i dont care whose faullt it was-we just want to have the life we had before- our money in the bank and nobody taking our houses off us.
 
Garpal Gumnut said:
The bright light of investigation will stay on the banks for a while but the Storm "model" was the real cause of the loss of the Stormers capital. gg
Click to expand...

Macquack said:
I agree with GG.

Question - Since when has "loan documentation" been utilised for the purpose of protecting the borrower rather than the lender?
Click to expand...

The whole Storm model was predicated on the ability of the investor to continue to leverage the equity in their properties as the values increased. This only worked if the Bank's were compliant and/or complicit in the use of unverifiable incomes to underpin the servicing of the loans.

So in essence the home loan issue is part of the Storm model.

Effectively no home loan, no investment, with no investment there is no margin loan and if you don't have a margin loan you don't get a margin call.

The home loan was the starting point and at this time it is the easist component to focus on and get the investors some relief.

There is no doubt, given the over > 50 investors I have seen, that the advice was flawed and in many instances it had no hope of ever achieving the projections. It seems to have been lost on many that the redemption of capital does not represent income and as a consequence the retired investors were going around in ever diminishing circles until the capital ran out.

Yes the Storm model was flawed however is there any point pursuing Storm at this time?

The heart of the issue with BoQ is their preparedness to accept information from Storm and then use different information in the applications in order to get the loans approved. They didn't even have the sense to sanitise the files to ensure contradicatory information was removed.

Of course they blame the client, it is rather amusing that poor old BoQ is now intimating they have been the victim of a co-ordinated 'fraud' by some 300 clients from all over Australia who overestimated their incomes to around the same amount and all left out the margin loans on their applications.

That being the case they must be either in on it or incompetent or as is more likely, both.
 
Pindibog said:
I do it is my morning and afternoon read with a cuppa. Live in the country and too far to drive just to pick up a newpaper. Good work Solly!
Click to expand...

I likewise want to thank you Solly for keeping us up to date..... and to Carey Ramm. You have both been great sources of what the latest is in this real life tragedy and given us hope and the will to keep going when often there was none or not much. THANK YOU.
 
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