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Storm Financial Group

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give it up mate - in case you didn't notice this is a stock forum - not a storm victims love-in. SICAG seems to have the monopoly on that unfortunately.
 
And the Saga continues...

This is likely old news to most but, from some info I have gathered, former Storm High Up, David McCulloch, has set up shop and offering financial advice.. The things that is new news to me, is he appears to be taking on a lot of former storm clients, Bastard.

I have heard from some of my sources some terrible claims of false and misleading advice in regards to clients previous portfolios held with storm. I got some of this info directly from a friend who is seeing him, and what David has explained in relation to my friends Loans could not be further from the truth.. I quickly gave said friend a slap up the side of the head so to speak, but I dont think he is listening to me...

I cannot believe that at this stage into the inquiry etc. that any advisor tied to storm be allowed to operate, at least until all findings are finalised..

This just plain makes me sick!!!!
 
I've been castrating some calves since midnight and off to the airport after a shower to catch the redeye to Brisbane for the inquiry.

Talking of which, I do hope Manny turns up to the Inquiry.

In concentrating on the banks , the SICAG model will ensure that Storm will not be the last Financial Planners debacle, should they get their way.

From evidence recently the Storm menagerie are spawning other active Planning companies that are operating as I write.

The Financial Planners Association and ASIC are gooses really.

These guys are playing for hgh stakes and are not stupid, I'd even say they are convincing for the gullible.

If he doesn't turn up I'll probably just visit the art gallery and catch up with a girlfriend down there who's picking me up from Eagle Farm. Although I must admit I'd pass up on pleasure to see Manny squirm.

gg
 
I hope he is there too GG, be heading straight there after a 12hr shift... I figure if he is not I might take a drive out to the Eagles Nest (london rd. Belmont) care to tag along? I have a spare seat on my D9....
 
"Defiant Cassimatis likely to target CBA"

Read more on page 43 of the Australian Financial Review Sept 3 2009 by Duncan Hughes and AAP.
 

gg, remember a castration knife can't be taken on board as carry on
 
Monario said:
I cannot believe that at this stage into the inquiry etc. that any advisor tied to storm be allowed to operate, at least until all findings are finalised..

This just plain makes me sick!!!!
Click to expand...

Totally surprised me as well. After reading the 26 August transcript of the inquiry it appears to be a quirk in the licensing system. The principal of the firm holds the license and a planner can be an authorized representative under that license and so can move from firm to firm. Buggered if I know where their ethics are after screwing so many. They probably don't have any.
 
Solly said:
gg, remember a castration knife can't be taken on board as carry on
Click to expand...

He should be able to source one in Brisbane. As it is only going to be used on a one-off basis, he can leave it behind when he boards to go home.
 
They've all set up shop elsewhere. Can't post the links because I haven't made enough posts. Look for Infocus Redcliffe office & Infocus Chermside office.

There are others, but I can't recall where they went to at the moment. It'll come back to me.

Manorleas
 

The aggressive tone of your post does you no credit at all. People of character and maturity are able to express themselves in a calm and reasonable manner, even when they're angry.
This is a public forum whose objective is discussion and sharing of views and ideas on just about any subject at all. It's not realistic to think we'll agree with every view expressed, but we need to be mature enough to disagree in a courteous manner.
By 'flying off the handle' as you've done, you've degraded yourself as an immature little person who can't keep a lid on his/her anger.
You're in breach of forum rules. Be warned that if you keep it up, I'll be lodging an official complaint with the moderator and asking that you be disciplined.

As for the 'rubbish' I'm spouting...if you'd read this entire thread, as I have, you would have seen posts from people who have told of what level of wealth and real estate ownership they had before getting tied up with Storm. Some of them were substantially wealthy, were at or near retirement age, and had no need to ever work again.
Also, if you read through all the submissions to the Parliamentary enquiry you'll find that some people had significant wealth before getting tangled up with Storm.

Yes, I do have compassion for Storm victims, and I've expressed it in a number of my posts.
I acknowledge, as I've done many times previously, that most Stormers were just ordinary people trying to build up a nest egg so they'd have a decent quality of life in retirement.
Obviously, I was not directing my query to them when I asked why people who were already wealthy and set up for retirement, would risk their wealth by gearing heavily to invest in the stock market through Storm.

In no way do I condone the unscrupulous dealings of Storm and the banks. I'll be one of those applauding if anyone is sent to jail over this.
But I stand by my query to the people who were already financially well off before joining Storm......why did they risk their wealth when there was clearly no need to do so?
 
I was going back over some old information, and came across this in the judgement from Judge Greenwood on 24 December 2008.

http://www.austlii.edu.au/au/cases/cth/federal_ct/2008/1991.html

The most important points in the article suggest that Storm was not responsible for relaying information to clients regarding the margin loan, as they did not receive commission from the product. This is completely different to what actually happens on loans, where an adviser is attached. All communication is made via the adviser. Only if it becomes apparent that the adviser is not making contact with the client, will the margin lender step in – however, by this time clients could be deep in negative equity.

Here are some of the pertinent points from the judgement.

20 EC says (para 26) that the clients were responsible for identifying circumstances which would constitute a margin call. However, if a margin call did arise, the Bank would give notice to the client borrower. If the client borrower did not respond to the margin call, the Bank would take action to sell the underlying securities. The only role (para 27) which Storm had in the management or monitoring of margin loan facilities for customers of the Bank "was that CGI was entitled to give notice of a margin call to the customer by giving such notice to Storm".

23 By the end of November 2008, EC says that clients of Storm who had taken up margin loans with the Bank faced a negative equity position of approximately $37 million.

24 These events led to a meeting on 1 December 2008 at the Sydney premises of the Bank. EC & JC met with Messrs Grimshaw, Tait and Clothier of the Bank. EC & JC complained that for a period of some weeks data supplied by the Bank had been inaccurate and unreliable. That data related to daily data sheets sent by the Bank to Storm which set out details of each client, the balance of the loan, the credit limit, the security value, the market value of the securities, the current loan to security ratio and the margin call to security ratio. The data was thus comprehensive and sent daily to Storm. Some of the statistics in the margin ratio column are incorrect. The daily variation in values is said due to rapidly changing market circumstances is said to be the explanation for those errors.

26 Another meeting occurred on 4 December 2008 at the Bank's office. EC attended with a view to seeking a solution to the problem which had arisen for clients basing margin calls and particularly those whose facilities had "gone into negative equity". Mr McCullough and Ms Richards, executives of Storm, attended the meeting. It lasted for three hours.

28. EC thought that he might be able to assist in resolving the Bank's concern about the 640 or so accounts. EC put a proposal to the Bank that Storm borrow from the Bank a sufficient sum to recover "the lost funds represented by this negative equity; that it [Storm] would then, by some means provide financial assistance to the relevant clients in the same amount so that they could recover the negative equity positions (without selling their own assets or otherwise devoting their own funds at the time) and, in the period of the ensuing year or two, work to recover such shortfall". EC says that he intended that the Bank would regard this as a generous offer by Storm because Storm would take on the primary liability itself in a direct relationship with the Bank.​

Is not receiving commission grounds to not pass on information to clients? I believe that this will be the crux of the EX & JC defence.

The fact that the information received from CGI was not good enough, in my eyes does not absolve their duty to calculate their clients LVR and inform them if they are in margin call. After all, they have made themselves out to be their adviser/mentor/guide ...

Thoughts?
 
My Comment
I really would like to remind EC that there were other margin lenders apart from Colonial mine was with Macquarie.
I was in margin call, most of September and begged my Financial advisor to sell me up (face to face) on the 30th September 2008 and her reply was
"I have sold me up I am not allowed to sell you up".
They are the same words uttered by Gus Dalle Court in Tuesdays hearing.
(He was given orders not to sell anyone up)
I never heard from Macquarie ever during that time.
I was finally sold up on 28th October by Storm.
 

Good gracious! Talk about a control freak. They really did treat the whole thing as if it was their money and not yours. The more I read of this the more I understand the fury against Storm and the finance lenders.
 
I know of a guy who worked at one of the Storm offices who started there just as it all hit the fan (no names, no court-martials) who confirmed that Manny REFUSED to sell anyone up, and anyone that demanded it was phoned and given the spiel 'this is exactly the type of knee-jerk reaction we told you we wanted to avoid.....you need to stick to the plan' and words to that effect.

He said it was the most soul-destroying thing he had ever seen, as he watched the senior advisers on the phone telling people that everything was fine, when most of the junior people in the office knew it wasn't.

A family member of mine rang CGI after it all went down and demanded to know who authorised the sale of his investment. He got an Email back (that had been forwarded to Storm HQ a few months previous) that had a list of clients (including him) that were in negative equity, which obviously was a mistake noting the privacy invasion involved.

In other words, Manny and Storm advisers KNEW that their people were in negative equity, but sat on their hands and did nothing about it, and didn't even bother calling their clients.

If as Manny claims, it was solely the banks responsibility, what exactly were Storm clients getting for their 7% fees? Use of the Storm fax machines to send off scatter-gun loan apps for ridiculous amounts of money and a coffee?
 
Hi Ya Shibby!!!

i am most interested in your comment that your adviser had sold their portfolio up but was under instructions not to sell your portfolio.

In recent weeks i have become aware that during the may to september period some of the advisers sold their private portfolios. I am collecting information on which advisers and dates.

Shibby can u tell me (either in a post or as a private message) which adviser u had and what date they told u they had sold their portfolio.

If anyone else out there has information on advisers selling out can they contact me also. Shows how useful this forum really is.

Guys the reason storm didnt want to sell anyone out (why storm instructed advisers not to sell anyone out) was that they new if they liquidated the portfolios there would be no way they could get anyone back in the market and hence they would have no clients and no business (storm would have been back to square 1) - so they cross their fingers and hoped the market would bounce back before the margin loans were called in (they gambled for purely selfish reasons and lost with the clients being the big losers). Most stormers were sold out between 4400 and 4000. The market fell another 23% from this point. At 3100 the negative equity in the storm portfolios would have exceeded $300m.

Another point to remember is that the Maquarie margin lending book was of similar size to CGI - there was over $2billion in margin loans! I understand that once the Margin lending book reached a certain size, the interest rates on the Storm corporate loan facility (used for building purchases etc) became zero. Pure conflict of interest!!!

I also suggest you read the Alan McDonald submission (the Storm IT guy) as i think he is pretty much on the money in terms of what happened and how it went down.
 
I am only guessing but I imagine the other reason for Storm not wanting to sell everyone up is that their clients would no longer receive an income from the index and the whole house of cards would fall due to not being able to service loan repayments. Interest return on cash would have been bugger all.

Even those that had pre-paid interest would only have been spared in the short term. With a $1m loan say, if you're relying on the income to help meet at least part of the loan repayments and if you're out of the market for 3-6 months and get no income it's only a metter of time until you're out the door backwards.

Storm (EC) must have known this to be the case (if they had even an ounce of brains) - he would have been caught in a no win situation so he had to ride it through and pray the market would rise in time.
 

Seems pausible but somewhat contradicted by sending letters out seeking authority to convert everyone to cash.
 
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