Storm Financial Group

[cuttlefish]

Harleyquin - there is quite an irony that posters on this forum and other forums feel that, to protect themselves legally, they should refer readers to the fact that they are not financial advisors and to seek 'professional advice' while at the same time knowing full well that a big chunk of 'professional advice' is ordinary to say the least.

 

[Harleyquin]

Learning in the 21st century is about life long skills. (This is a point that non-educators may find challenging and are likely to criticize loudly as they don't have the understanding of current educational philosophies) If too much emphasis on financial knowledge is placed on school curricula we run the risk of teaching our students information that will be obsolete within 2 - 3 years (even less). On the other hand...I definitely see why people want to add it. A lot of it is about trying to give students some understanding of finances before they leave school. All too often I hear people use school as the fix-up for society's problems and so have an almost inbuilt cringe mechanism when people suggest putting yet another thing in a very overcrowded curriculum.

Teachers, in this technological age, have been teaching students now for quite some time for jobs which haven't been invented yet. The basics of the the three R's are still as relevant today as they ever were, today teachers are expected to take on a lot more of the testing and reporting processes than they were a generation ago. I can appreciate all the points that you have made in your statement. I know teachers in primary and secondary schools are an extremely dedicated and hard working group and the school curriculum is certainly overcrowded and the teaching profession has changed far more than many realise.

I just happen to believe that financial management is an extremely important subject / issue and if the basics were taught this would be better than nothing. A lot of it, as you have already stated, is about trying to give students a good basic understanding of finances before they leave school. If it isn't feasible to include this in the present curriculum then maybe we need to look at how it could be included without taking up a lot of time.

My suggestion would be for a panel of financial people, teachers and parents to look at coming up with a good reference book which explains everything in simple language and yet covers the important issues, the risks, the types of investments, the need to keep abreast of current issues and the need to educate yourself and how to do it prior to making any important financial decisions. This way every child is guaranteed to receive the same level of financial education and the teachers would simply be teaching the information in this book.

It could also be taught that this is a good basic reference book to refer to before deciding what to do in the future and included in that advice would be 'it is to be stressed that it is important to keep up with current information' and the book could be updated say every five years to try and keep the information current. With a lot of thought this subject could take up only a small amount of time and be an important part of their first year of high school when they are taking most subjects prior to making a choice of which subjects they will take later on.

In this way perhaps the students still receive this important information and is far better than receiving nothing at all. I am not aware what information students receive at present but there is a definite need for specific financial education. Students in primary or high school used to and perhaps still do receive sex education which consisted of a couple of sessions but at least they were given the information.

If the suggestion for a good, basic reference book is successful then it could also be recommended for anyone to read before embarking on their financial journey in life...and to read other reference material. Often at the back of these books other books on the subject can be recommended. I would certainly agree that there is a need for change and more education. How we manage to achieve than is open to debate but nothing ventured nothing gained.

 

[Harleyquin]

Maybe you should go back through the posts on the SICAG website then and find the one I'm talking about. It is out there.

Pindibog is right the submissions haven't been posted on the SICAG website they are sent to the relevant people for the parliamentary inquiry and can be viewed by anyone.

 

[Grey Ghost]

"Legal tussle over Storm documents"

Previously posted by Solly - Quote
"PEOPLE involved in Storm Financial's collapse, including the founder, Emmanuel Cassimatis, may face further action over the collapse of the financial planning group, legal manoeuvring at a parliamentary committee hearing suggested last week.

Mr Cassimatis told the committee he had gathered documents and asked for permission to table them.

Tabling documents before a parliamentary committee means they gain the protection of parliamentary privilege"
End Quote


Manny was being very sneaky and tricky at his recent appearance at the inquiry. In an earlier post I said that I didn't think he and JC would show up at all. Well I was half right JC played the sick card and didn't front (like to know exactly just what her ailment was - probably something along the lines of fear of having to answer awkward questions). As for Manny he was clearly trying to play a get out of jail free card. I recall that the DOCA he put forward when Storm fell over early this year would have completely let him off the hook. Fortunately it didn't get off the ground however he was obviously playing a similar game at the inquiry by trying to table some documents and get them under parliamentary privilege which would have helped his cause no end and made it more difficult for any other agency to prosecute him at a later date. Also his lawyer supposedly 'offered' to help the inquiry but fortunately was told to button up and keep quiet. No doubt he was going to try and pull some stunt to try and make it a lot more difficult for anyone to see to it that Mannies day of reckoning comes. Fortunately Bernie and the crew didn't fall for any of this but it illustrates how sneaky this slippery eel is and if everyone isn't careful he'll slip through any net that is put out for him.
All I can say is that if Manny appears to offer ANY co-operation about anything everyone should be very careful when dealing with him as he is almost certainly running another agenda - ie to get himself out of any potential day of reckoning.

PS sorry about the quote as it had a link in it and I haven't had 5 posts yet I had some trouble copying it. I'll try and do better next time.

 

[Solly]

"Storm did not act on margin calls: CBA"

"Storm should have informed clients"

More from Wouter Klijn in Investor Daily here;

http://www.investordaily.com.au/cps/rde/xchg/id/style/7336.htm

 

[Solly]

"More Storm action for BoQ"

"Bank of Queensland is facing a second writ from a former Storm Financial investor as the bank stands firm against a push for a negotiated settlement on behalf of clients who borrowed to invest in Storm products."

Read more by Duncan Hughes in The Australian Financial Review of Monday, 07 September 2009.

 

[Solly]

"Legal tussle over Storm documents"

"PEOPLE involved in Storm Financial's collapse, including the founder, Emmanuel Cassimatis, may face further action over the collapse of the financial planning group, legal manoeuvring at a parliamentary committee hearing suggested last week.

Mr Cassimatis told the committee he had gathered documents and asked for permission to table them.

Tabling documents before a parliamentary committee means they gain the protection of parliamentary privilege"

More by Stuart Washington in the SMH here;

http://business.smh.com.au/business/legal-tussle-over-storm-documents-20090906-fcss.html

"Storm can't clear parliamentary committee"

Another version from Stuart with an interesting pic from Glenn Hunt
(I reckon I predict a sardonic comment from gg)

http://business.theage.com.au/business/storm-cant-clear-parliamentary-committee-20090906-fct8.html

 

[Harleyquin]

Manny was being very sneaky and tricky at his recent appearance at the inquiry. In an earlier post I said that I didn't think he and JC would show up at all. Well I was half right JC played the sick card...No doubt he was going to try and pull some stunt to try and make it a lot more difficult for anyone to see to it that Mannies day of reckoning comes. Fortunately Bernie and the crew didn't fall for any of this but it illustrates how sneaky this slippery eel is and if everyone isn't careful he'll slip through any net that is put out for him. All I can say is that if Manny appears to offer ANY co-operation about anything everyone should be very careful when dealing with him as he is almost certainly running another agenda - ie to get himself out of any potential day of reckoning.

Grey Ghost you've hit the nail well and truly on the head with your obs of EC and JC. Fortunately the former advisors realise it now. Unfortunately it is too late to save our investments but we all want to see this animal in a cage so that he can't repeat these offences, and many believe that his partner in crime JC isn't as innocent as she would like any of us to believe.

Whether anyone likes it or not there are former storm advisors out there who were duped by this man and are now doing everything they can to help or rectify the present situation and I for one appreciate what help they are able to give. Their information will hopefully help our efforts to convict those responsible and help us to receive some form of compensation as we certainly need all the help they can give us. I know there are many of you who can't forgive your advisor and we struggle to do that also. We all realise that they should have been in a position to know better.

Manny doesn't seem to realise that his strategy was far too aggressive for those of us who wanted a safer investment and he made it impossible for our advisors to do that. I cannot forgive him for that. The banks are financially educated to realise this also, but realised very early on that by 'attaching' themselves like leeches to this man, that there was big money to be made, and they made it and would be continuing to make it if the GFC hadn't occurred. The advisors always believed that storm central would protect us in the event of a downturn, they didn't, and the banks were from what I'm finding out very much a part of this.

I know I'm going over old ground here but I cannot understand why they placed margin calls with their other clients at a safe level and their investments are still safe. They let storm clients blow out of all proportion until it was far far too late. Manny no doubt would have contributed to this but the bank has the final say on when this should occur and no storm client was ever advised until it was too late. I want the banks to explain why they did this as it was this very aspect that killed us and the company.

Manny had billions of his clients money invested, was responsible for it and should have been watching what was happening in the rest of the world and been prepared for any inevitability. From all accounts he wasn't prepared. The global financial crisis didn't occur overnight, the signs were there two years before that a drop was possible. Had the company adopted the policy which convinced us that they knew what they were doing, ie selling high and buying low, then we would have been well placed for a recovery.

Other investors on this forum knew that something was happening and prepared for it. Storm had the resources to employ the best and didn't do it. If anyone is greedy it isn't the investors it's EC's company and the leeches who attached themselves to this company. This inquiry is now starting to get to the truth of the matter and we are seeing for the first time in Australian history the major banks admitting to their major shortcomings.

 

[Farencue]

Hmmm - as a teacher I have a real dilemma when people say stuff like this. I heard it at the inquiry on Thursday and instantly had a very negative reaction to it. At the same time I understand what people are trying to suggest.

This is why the negative jumps out..
1 - If many people in the financial industries cannot educate themselves properly (as seems evidenced by the lack of qualifications attached to being a financial advisor) or others (as seems evidenced by the extensive education plan that SF clients thought they were getting) what makes you think that primary and secondary teachers would do better?
2 - How deeply would you expect a primary or secondary student to learn aspects of financial management?
3 - What is currently in the curriculum of our students that you believe should be thrown out in order to fit the financial management curriculum?
4 - Are you aware of what aspects of finances are already included in the curricula (primary and secondary) around the nation? You might actually be quite surprised to see what is actually there. It is not all in maths by the way.
5 - There are aspects of financial management (eg superannuation) that most students wouldn't learn (even if it was in the curriculum) as it is not relevant enough to their world at the point in time that the learning is occurring.
6 - Learning in the 21st century is about life long skills. (This is a point that non-educators may find challenging and are likely to criticize loudly as they don't have the understanding of current educational philosophies) If too much emphasis on financial knowledge is placed on school curricula we run the risk of teaching our students information that will be obsolete within 2 - 3 years (even less). Students need to learn how to be flexible with their learning and find answers that are relevant to their context at the time they are learning. We need to develop our primary and secondary school students as people who recognise that information changes rapidly and learn at all times in their life.

On the other hand...
I definitely see why people want to add it. A lot of it is about trying to give students some understanding of finances before they leave school.

It was brought up by representatives of the Australian Investors Association in Brisbane on Thursday. Senator McLucas was very quick to point out why it really is not a valid option. I would suggest you might like to read the Hansard when it comes out to get your own understanding of what she said.

All too often I hear people use school as the fix-up for society's problems and so have an almost inbuilt cringe mechanism when people suggest putting yet another thing in a very overcrowded curriculum.

Cheers
Maccka

Could not agree with you more Maccka. My teenage son is in his 4th year of working hard at 2 jobs after school and on weekends. He has saved over 10k as well as contributing $200 per month to a managed fund, which was set up with the first grand he saved.
He did not receive a financial education at school and we, his parents, are definitely not wealthy. We have given him advice from things we learnt along the way ourselves eg: dont blow all your savings on your first car, save more than you spend, put away a percentage of each pay for savings, compound interest, depreciation, how to spot a conman who only wants your money etc...

It is all a bit of commonsense and research and critical thinking.

I understand people wanting the government to legislate the industry to ensure no financial mistakes are made but you will always get people who dont know the saying "if it is too good to be true then it is" or "no such thing as a free lunch".
It is human nature to want an easy, get rich quick way (and I am not pointing fingers at Stormers) and it is also human nature to want to follow the herd.

I have been conned more than once in my life financially, and the best thing about it is I can pass the education I received the hard way to my kids.

Critical thinking is the best life skill you can teach kids in my opinion.

 

[Harleyquin]

Harleyquin - there is quite an irony that posters on this forum and other forums feel that, to protect themselves legally, they should refer readers to the fact that they are not financial advisors and to seek 'professional advice' while at the same time knowing full well that a big chunk of 'professional advice' is ordinary to say the least.

Cuttlefish I hope I'm reading your post correctly. Do you mean that we are not financial advisors? I'm a tad confused and not sure exactly what you mean, so I hope I'm answering you correctly?!!

Prior to going to a financial advisor I was under the distinct impression that we were seeing someone who was an expert in the financial field who was going to help us with our financial situation as this is what you read from many of the experts. After reading the many comments on this forum I understand what you are all saying is correct that in fact a big chunk of 'professional advice' is ordinary to say the least' I was never aware of this before and wish that I had known. If I had of been we wouldn't have bothered going to a financial planner. We trusted them far too easily thinking that they knew exactly what we wanted, after filling out our paperwork telling them this, and believed that they would genuinely look after us. Had either of us realised this, we would have just educated and invested ourselves as I now know many of you do on this forum. Unfortunately we found this out too late as have many others. Most storm victims will never trust another advisor and many will just put their money in the bank if they ever get enough. I had no idea this forum existed until a couple of weeks ago so I'm still reading through many of the former posts and if I'm travelling over old ground for many of you I apologise as I haven't finished reading them all yet, just give me a little more time.

I want to see that statement 'see a licensed financial planner and take their advice' banned, it is not good advice for those of us seeking a solution to our financial problems. Our situation with Storm has proved this statement to be quite untrue, they all need to come with a significant warning, saying 'only use a financial planner at your own risk' or something similar. Had any of us taken this advice we would all be ok. I was at a social function on Saturday night and talking about our situation and someone at our table said that they had worked for a financial planner a few years ago and she said 'I went to a financial planner and got a financial plan drawn up but I never let them act on it' and someone said 'why?' and she said ' I just decided what I agreed with it and I only acted on the parts that I agreed with, it's easy to do, come and see me and you can do it all yourself.'

There were about twelve of us at the same table of a similar age and we were talking about financial advice and most people at the table said 'we'll never have enough money to worry about it.' I do worry about it but don't know if I can develop the skills that I need to be successful and just as importantly if I've got the time to start all over again. Someone said to me 'don't worry about going into an old peoples home and going on the pension, we'll all be there.' One couple at the table had lost their teenage so in a car accident a while back and she said 'just live for today and don't worry about tomorrow none of us know if we are even going to be here and if we are the government can look after us, you'll get cheap doctors and chemists don't worry about any of it, we all pay our taxes and we all work hard just enjoy it while you can.'

 

[bunyip]

Thanks guys and gals.



I feel financial management should be introduced in primary school and that it should be a required subject for an OP score in high school.

It is just as important as Maths and English.


gg

Absolutely agree that personal financial management & investment etc should be taught in secondary schools.

Even if it wasn't an OP subject, make it compulsory for one lesson a week - just basic stuff like savings plans, budgets, taxation benefits of borrowing for real estate and shares, taxation implications including tax deductibility of expenses related to investments, the importance of making sure your real estate investments are in growth areas, websites to find information, etc etc.
Most teachers probably have insufficient knowledge to teach such a subject at present, but it's only a matter of making it part of teacher training. In the meantime while teachers themselves are being trained in this subject, maybe the education department could liase with professionals from the real estate, banking and stockbroking industries to come up with a way of getting investment information into schools.

One thing certain is that something needs to be done to address the current situation where the average 17 - 18 year old leaving school has virtually no investment knowledge and will never get it unless they're fortunate enough to have a curious mind and an ambitious nature that compels them to seek out ways of educating themselves about investment as they go through life.

In secondary school I was compelled to sit through a boring 30 minute lesson each week called 'Music Appreciation'. It was run by a dour music teacher in her mid sixties, and for half an hour each week she attempted to get our class of 15 year old boys interested in Mozart, Beethoven, Bach, and sundry other musical geniuses of yesteryear.
No wonder we used to give the teacher a hard time by misbehaving during her music class! As 15 year olds we were bored silly by learning about composers of classical music. If we'd had some switched on investment guru showing us what was possible by saving and investing in shares and real estate, I'm sure we would have found it more interesting and beneficial than our music appreciation class.

I've been educating my four kids in personal investment since they were about 10 years old. The eldest, who will finish her uni degree and join the workforce at the end of this year, has already set her investment and personal wealth goals and has mapped out a plan for achieving them. She knows exactly what she's going to do, and she has the knowledge and the desire to do it.
Her mentor, me, has no formal qualifications as an investment adviser.
She's very much in the minority, but every kid could be just like her, with a similar level and knowledge and commitment towards getting ahead financially, if professionals taught them about personal finance management and investment while they were still in school.

 

[Rainbow]

Pindibog is right the submissions haven't been posted on the SICAG website they are sent to the relevant people for the parliamentary inquiry and can be viewed by anyone.

That's right, but that's not what I said. I'll reiterate... SICAG members were initialy told by SICAG committee not to post individual stories to the Parliamentary Inquiry ...

 

[bunyip]

Yes Halrey. we are all wondering the same, Many people in the public, and here on ASF have the view that WE are the ones responsible, and although I do feel some responsibility for letting it go so far, I definately do not feel as though we are at the top of the food chain in blame on this one...

Monario
Let's be fair here.....most of the people in this forum who have attributed any blame to you Storm investors have said you must bear your share of the responsibility for taking on unsustainable levels of borrowing etc etc.
I don't know of anyone whose put 100% of the blame on you. If anyone has, then they're very much in the minority.
Most of us have the sense to see that Storm, the banks, and the individual investors themselves all played a part in the debacle that resulted from investing through Storm Financial.

 

[Judd]

....but every kid could be just like her...

Hmmm, so you are suggesting that there is a "one size fits all model." Wasn't that what Storm offered?

Also if proper attention had been made in music class during your school years, you may now be a world famous classical musician. But, despite the quality of the teaching, it does not seem that the necessary interest was there otherwise you would have explored that subject irrespective of the teaching.

I'm a cautious about assuming what one family does or can achieve is applicable to all families. It doesn't allow for individual personalities and traits.

 

[sails]

...I want to see that statement 'see a licensed financial planner and take their advice' banned, it is not good advice for those of us seeking a solution to our financial problems...

Harleyquin, I agree with you, but while ever it is illegal to give any sort of financial advice, anybody offering suggestions or simply ideas in the financial area will have to use that statement to cover themselves. IMO, it's more of a legal disclaimer rather than a recommendation to see a planner.

 

[Harleyquin]

Absolutely agree that personal financial management & investment etc should be taught in secondary schools...Even if it wasn't an OP subject, make it compulsory for one lesson a week - just basic stuff ....I've been educating my four kids in personal investment since they were about 10 years old. The eldest, who will finish her uni degree and join the workforce at the end of this year, has already set her investment and personal wealth goals and has mapped out a plan for achieving them. She knows exactly what she's going to do, and she has the knowledge and the desire to do it.

Congratulations Bunyip your children are very lucky that they have a dad who is interested and knows what to do. I'm doing a lot of reading at the moment but have no idea how to even begin to plan a financial strategy. I can budget and save but have no idea how to make my money work for me. Hopefully by the time I finish all this reading I'll develop enough confidence to have a go, if not, I'll just have to go back to putting our money into a term deposit as we have always done before losing everything in the storm.

I agree with everyone who has said that some basic financial advice needs to be incorporated into the present school curriculum. I personally like the idea of a good reference book but others may have a better idea. My husband often got 100% for maths at school and I regularly got in the 90% and yet neither of us have any idea where to start financially, we are both hopeless. We followed the market and could see what was happening last year and we are novices -that's why I cannot understand why this situation is as bad as it is. We blame ourselves for misplacing our trust. We have been called greedy and told 'this is all your fault', that hurts so much as we thought we were doing the right thing.

 

[DocK]

Hmmm, so you are suggesting that there is a "one size fits all model." Wasn't that what Storm offered?

Also if proper attention had been made in music class during your school years, you may now be a world famous classical musician. But, despite the quality of the teaching, it does not seem that the necessary interest was there otherwise you would have explored that subject irrespective of the teaching.

I'm a cautious about assuming what one family does or can achieve is applicable to all families. It doesn't allow for individual personalities and traits.

Agree that all families are different - Bunyip's children are very lucky to have a mentor who both has some financial knowledge and is willing to share it. Lots of kids aren't so lucky, and I think the answer lies partly in educating the parents. Wish I knew how this could effectively be done - a lot of folk simply aren't interested. Perhaps free community sessions run by industry types (who would all naturally be pushing their own barrows) would at least give interested people an overview of the options?

I'd love to see kids given more financial instruction at school, but acknowledge that there just isn't time to teach them all they should know. It is also impossible to make the average teenager interested in a subject they often don't see as relevant to them. Julia mentioned she got zero interest in a programme she was willing to run - doesn't surprise me really - kids these days are so busy and stressed with so many more extra-curricular activities than most of us had, and more pressure on them for the all important OP (or equivalent). I'm sure they're quite keen to pay attention to the driving instructor, and the sex ed classes (if they don't know it all already) but something as boring as how to save money and invest wisely just doesn't seem important when you probably won't be earning any real money for years.

I'm sure I'll get shouted down for this - and I know it's viewed as very important by some - but I'd like to see some of the time spent on religious instruction in schools be spent on basic life skills and how to behave with ethics/morals in our rapidly changing society.

 

[Farencue]

Harleyquin
Exactly where have you seen the words "see a financial planner and take their advice" written?
I have seen "see a financial advisor FOR financial advice" written, which is a completely different scenario to "take their advice".

Always, always apply critical thinking to everything you do, whether it is finances or deciding to join a committee.

DocK, my kids go to Catholic schools and "religion" at their schools is actually called "religion and ethics". They cover many different subjects and discuss the ethics involved eg: female circumcision in some African countries.

 

[Julia]

There were about twelve of us at the same table of a similar age and we were talking about financial advice and most people at the table said 'we'll never have enough money to worry about it.'

And as long as they take such a view, no, they indeed will never have enough money to 'worry about it'.

I do worry about it but don't know if I can develop the skills that I need to be successful

Of course you can. Don't exaggerate the difficulty of learning the basics of sensible investing.

she said 'just live for today and don't worry about tomorrow none of us know if we are even going to be here and if we are the government can look after us, you'll get cheap doctors and chemists don't worry about any of it, we all pay our taxes and we all work hard just enjoy it while you can.'

I wonder if she will feel quite so cheerful and philosophical when the age pension just doesn't cover quite basic living expenses, when more and more drugs are removed from the PBS, when waiting lists at hospitals blow out even further than they are now, and you stand the risk of dying on a gurney in the hospital corridor.

Also if proper attention had been made in music class during your school years, you may now be a world famous classical musician. But, despite the quality of the teaching, it does not seem that the necessary interest was there otherwise you would have explored that subject irrespective of the teaching.

I agree, Judd. Personally I'd hate to see any attempts to interest young people in classical music dispensed with.
Obviously it's really difficult to devise a curriculum which covers everything we think young people should know about.

I'm a cautious about assuming what one family does or can achieve is applicable to all families. It doesn't allow for individual personalities and traits.

Bunyip, you are in the minority in teaching your girls about money management and investment. I completely agree that you're doing the right thing. But remember that the number of adults who understand anything about even the most basic investment is minimal, sadly.

 

[Mash]

I've been watching this, as a member of SICAG, and you have raised my suspicions. When we first heard about the Parliamentary Inquiry, SICAG did not want us to post our individual stories - they wanted to put across the one voice and told us not to send in information... else we'd choke it up on non-relevant sob stories. They seem most insistent on pushing the CGI/Commonwealth bandwagon, yet offer little in the way of comment regarding other institutions and their theory as to why we ended up broke too. Maybe now they've heard Manny lie through his teeth, they'll see the light.

Sorry Rainbow...that statement is false..... SICAG was pushing for as many people as possible to lodge submissions and just tell their stories....