Storm Financial Group

[specialed]

The comments that attack SICAG and its motives or the role it should play astound me. They, like everyone, are interested in finding out the cause of this nightmare, and in time who is responsible and where the blame lies, be it with the banks, Storm, ASIC. Hopefully this will help to ensure it doesn’t happen again. However, SICAG was originally set up by storm clients to support each other. Many of these retired people are fighting to stop their lives sinking further into despair, if that is possible, with many having already been forced by the bank to sell everything they own. Most have been financially destroyed, and so if going after the CBA and CGI , rather than STORM for financial recompense seems suspicious to you, try existing under the permanent threat of losing your house, with no prospect of gaining employment because of your age.

The CBA have admitted problems with their loans, discrepancies in their systems (presumably the accuracy of their market monitoring software). Their submission appears to contain statements that are inaccurate in the least and possibly deliberately dishonest or deceitful at worst. The CBA has already begun a process of limited compensation, and has already admitted “some” fault. All this and there are still (at least) three investigations into this debacle to be completed. What more has to happen before some of the contributors to this forum eat humble pie, and admit that these people are victims and that SICAG, whatever its committee make up is should be doing nothing but seeking compensation for it members. Personally I don’t care who is on the committee if the end result is a better payout for those who have lost everything. STORM financial is a dead horse, the CBA took care of that and they have ensured that there is no compensation within that area that can help the victims.

Surely SICAG’s primary role should be to help its members gain some form of financial security from this debacle, and this stage that means the CBA and CGI for their role in this margin call disaster. Nothing else is going to help these people rebuild what’s left of their lives.

It is the role of the senate inquiry, the ASIC investigation and the inquiry by the liquidators to establish how this happened and who is at fault. Those contributors who continue with discussions regarding the composition of SICAG, its “model”, its purpose and all the other rubbish I read shows little in the way of an intelligent understanding of this whole affair. They also seem to have a very juvenile and naïve understanding of how people operate and the extent to which companies show scant regard for its customers, not to mention a very naive understanding of the way the media reports much of this.

Keep up the great work SICAG, and just go for the money !

 

[Judd]

CBA? Yeah, need a solid whip and kick to the nuts and must correct errors and failings.

Manny. Pity they have done away with the public stocks.

But Stormers? Totally blameless are they specialed? Not even sentient beings capable of cogent thought? Cannot even tie their own shoelaces? Drones? Just saw Manny on telly and thought, Gee here is all my money I'll ever earn plus my house and let's go Yipee! Despite all the huffing and puffing, it is people who make the decisions and they failed themselves and need to take a degree of responsibility. Not all certainly but definitely a degree of the blame. And no one will be able to convince me otherwise.

In the words of my 81 year old mother-in-law. who lives in Mossman, is sharp as a tack and like many other Queenslanders has been following the Storm story with interest, has reported to me of farms lost around Ingham "Dear, dear me such foolish people to bet the house. Careless."

 

[Farencue]

Specialed, two points you made:

SICAG set up by Storm CLIENTS? Er, I do believe there are ex Storm staff involved or am I wrong on that count?

The naive, unintelligent postings here?
The same could be said for the people who bet their house at the Manny casino and lost.

 

[specialed]

CBA? Yeah, need a solid whip and kick to the nuts and must correct errors and failings.

Manny. Pity they have done away with the public stocks.

But Stormers? Totally blameless are they specialed? Not even sentient beings capable of cogent thought? Cannot even tie their own shoelaces? Drones? Just saw Manny on telly and thought, Gee here is all my money I'll ever earn plus my house and let's go Yipee! Despite all the huffing and puffing, it is people who make the decisions and they failed themselves and need to take a degree of responsibility. Not all certainly but definitely a degree of the blame. And no one will be able to convince me otherwise.

In the words of my 81 year old mother-in-law. who lives in Mossman, is sharp as a tack and like many other Queenslanders has been following the Storm story with interest, has reported to me of farms lost around Ingham "Dear, dear me such foolish people to bet the house. Careless."

Its as simple as this.....They were informed (By the CBA and Storm) that if their margin loan LVR went above a certain amount they would recieve a margin call. Simple...It did, they didnt..no chance to save their portfolio..simply wiped out.. I was with storm people when all hell broke loose in September....And the common comment was "we almost got a margin call"......and then suddenly " We never got a margin call....its all gone..everything we have". It is now clear that they were not even able to monitor it themselves as the CBA through CGI couldnt even ensure their information was up to date....

To say these people have not taken a degree of responsibility is to show an ignorance to this whole event and shows that as you say, you are following the events but have obviously not spoken to any storm investors. These people have shouldered their responsibility for their desicions and the mental wellbeing of many of these people is showing the effects of this. With the greatest repect to your mother in law a margin loan is set up so you are not "betting the house". And thousands of people have recieved margin calls.But not after it blew out, in some cases to 40% above their agreed LVR. I mean please, what was the bank doing that it could move from 80% to 120% before being sold. Oh and what did the bank have to loose when this happened. Nothing. Infact..didnt this happen at a time when the CBA was desperatly trying to shore up its cash reserves ?

Storm investors never had the chance to save their houses as the responsibilty to monitor the LVR lay with someone else...And this responsibility was paid for in heavy commissions and heavy fees to the banks....As I stated earlier, even if they wanted to monitor the information was not current. How would you like to monitor the markets today, buy tomorrow only to find you are buying or selling at last weeks prices. It is difficult for me to see the Storm investors as having much responsibility for what happened when the CBA and storm acted to ensure they could not be responsible for the decision to save their homes....

 

[specialed]

Specialed, two points you made:

SICAG set up by Storm CLIENTS? Er, I do believe there are ex Storm staff involved or am I wrong on that count?

The naive, unintelligent postings here?
The same could be said for the people who bet their house at the Manny casino and lost.

You are wrong...Maybe you should not just believe all you hear....

 

[Ironhalo]

You are wrong...Maybe you should not just believe all you hear....

Yeah specialed? So you haven't read the last month or so of forum posts?

If that's not the case, can you explain what the father of Andrew O'Brien (a Storm Redcliffe adviser), Luke Vogel (an ex-Storm Redcliffe employee) are doing on the Storm committee?

And can you also explain why Andrew O'Brien called my brother up in the wake of Storm collapsing and 'volunteered' to take over again as his financial adviser but in a non-Storm capacity (evidently trying to take advantage of his past clients that were spectacularly failed during their time with Storm?) Or why evidence/an Email my brother had that implicated Storm/Manny in knowing full well their clients were in negative equity, was jumped on by the SICAG committee as it 'wasn't going to help their aims?'

Open your eyes, and don't be taken for another fool twice. SICAG is great on the surface, but dig a little deeper and you will find that there may be another agenda.

And as great as their BBQ's on Sutton's Beach might be, ask yourself one question, why has SICAG not ONCE placed ANY blame on Emmanuel Cassimatis on their website? Exactly.

 

[Garpal Gumnut]

specialed,

What is your relationship to

1. SICAG
2. SICAG committee members
3. Storm Financial
4. Manny and Julie Cassimatis
5. Ex Financial Advisers of Storm Financial
6. Ex owners of Storm Franchises in Queensland, NSW and Victoria.
7. The financial advising industry.

gg

 

[bunyip]

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.

Julia

The minimal number of adults with any appreciable amount of investment knowledge to pass on to their children is precisely the reason why I think the basics of saving and investment should be included as part of the school curriculum.
If the average parent lacks investment know-how to pass on to their children, then either we come up with another way of educating young people about how to make money work for them, or we do nothing and allow the present situation to continue - a situation where people end up falling victim to shonky outfits like Storm Financial, all because they lacked simple, basic investment knowledge that would have enabled them to take charge of their own investments.

 

[specialed]

specialed,

What is your relationship to

1. SICAG
2. SICAG committee members
3. Storm Financial
4. Manny and Julie Cassimatis
5. Ex Financial Advisers of Storm Financial
6. Ex owners of Storm Franchises in Queensland, NSW and Victoria.
7. The financial advising industry.

gg

1. NONE
2. Very close to a founder and have seen first hand how hard they work trying to salvage their own lives while supporting the grief and dispair of others.
3. NONE
4. Would like to meet them in a very dark ally
5. NONE
6. NONE
7. NONE and after seeing this debarcle unfold will not in future...

And Ironhalo...with regards to digging a little deeper, your conspiracy theories are hilarious and when you find out who really shot JFK let me know, or better still wave to me as your ship leaves roswell on your journey home....

Anyone with any understanding of the investors will know that alot of the families of Storm employees were investors, as I'm sure Storm employees were as well.

And if the email is so crucial...why have I missed it in your submission to the senate...or were you too busy trying to dispell the conspiracy of 9 / 11 that you didn't bother writing one ?

 

[specialed]

Yeah specialed? So you haven't read the last month or so of forum posts?

If that's not the case, can you explain what the father of Andrew O'Brien (a Storm Redcliffe adviser), Luke Vogel (an ex-Storm Redcliffe employee) are doing on the Storm committee?

And can you also explain why Andrew O'Brien called my brother up in the wake of Storm collapsing and 'volunteered' to take over again as his financial adviser but in a non-Storm capacity (evidently trying to take advantage of his past clients that were spectacularly failed during their time with Storm?) Or why evidence/an Email my brother had that implicated Storm/Manny in knowing full well their clients were in negative equity, was jumped on by the SICAG committee as it 'wasn't going to help their aims?'

Open your eyes, and don't be taken for another fool twice. SICAG is great on the surface, but dig a little deeper and you will find that there may be another agenda.

And as great as their BBQ's on Sutton's Beach might be, ask yourself one question, why has SICAG not ONCE placed ANY blame on Emmanuel Cassimatis on their website? Exactly.

Why would anyone in their right mind try to blame someone who might ??? have information that would help them when they try to sue a third party. Even someone of average intelligence can work why you would not want to do that....at this stage. The CBA is the only avenue for the storm investors to recoupe some of the money that this has cost them. Let ASIC identify the blame....

 

[bunyip]

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.

Empowering young people with the knowledge to handle their own investments by saving a percentage of each pay packet, and investing in shares and property, is vastly different to the highly risky, heavily geared, 'all your eggs in one basket' approach that was the hallmark of Storm Financial.

As a point of interest, Judd, what strategies, if any, do you suggest for people who wish to take charge of their own investments?

 

[Ironhalo]

Yes ASIC will identify blame, just like they gave Storm a big tick of approval just months before Manny started hoarding money out of the business and stashing it.

And as for why Mark Weir wouldn't take my brother's evidence (email copy from Colonial), you tell me mate. Perhaps because it showed Manny was just as much as fault as CBA, as he had instructed his staff not to sell anyone.

And have you read my parliamentary submission? It blames three people, myself, Storm and the banks.

Unlike the SICAG model which blames the evil CBA/Colonial and anyone but the Storm model or Manny/Julie's actions.

 

[specialed]

I'm sure I have, but let me know your submission no and I'll re read..

 

[cuttlefish]

Storm investors never had the chance to save their houses as the responsibilty to monitor the LVR lay with someone else...And this responsibility was paid for in heavy commissions and heavy fees to the banks....As I stated earlier, even if they wanted to monitor the information was not current.

This post to me highlights the lack of understanding by Storm clients of their own and/or Storm's responsibility in this process.

Who was responsible for monitoring the investments of Storm clients - was it Storm or was it the client? - because it certainly wasn't the bank.


The margin loan was a debt product used by Storm clients to leverage into investments. The bank provided the debt product - in providing a debt product it doesn't have any responsibility to the recipient of that product for managing the investments made with that debt product.

The bank is only responsible to its own shareholders to ensure that they minimised the losses from deteriorating assets (i.e.debt products). The best way for CBA to minimise losses is to make a margin call as early as possible - therefore CBA failed in its duty to itself/its shareholders as far as I can see.

It is whoever was meant to be monitoring the investments that failed the Storm investors.

Investors have a responsibility to themselves for monitoring their investments and their debt servicing obligations ... not banks.

Investors have a responsibility to themselves to ensure they adopt gearing levels that they are comfortable with and only take on risks that they are comfortable with and only take on debt that they can comfortably service.

Banks have a responsibility to their shareholders to increase their assets (i.e. selling debt products) while also monitoring asset quality and taking action if asset quality deteriorates. The bank failed its shareholders by not making early margin calls and thus increasing their losses - the bank didn't fail investors - investors failed themselves.

So if the investors were relying on Storm to advise them and relying on Storm to monitor their investments - then Storm failed the investors - not the banks.

Margin calls are a safety net. Its not a good investor that relies on a bank making a margin call to decide to sell down a portfolio. Portfolio management by debt default - never heard of that as a succesful investment strategy. Was that Storms investment model? Invest as much as you can and only sell down if forced to by a bank making a margin call? If so thats a terrible investment strategy.

 

[Judd]

Empowering young people with the knowledge to handle their own investments by saving a percentage of each pay packet, and investing in shares and property, is vastly different to the highly risky, heavily geared, 'all your eggs in one basket' approach that was the hallmark of Storm Financial.

As a point of interest, Judd, what strategies, if any, do you suggest for people who wish to take charge of their own investments?

Read. Simply browse bookshops and the library. And then make your own way basically ignoring other "Ya gotta do it this way" people. I may be curious about money and finances but it is neither a passion nor obsession merely a tool.

 

[cuttlefish]

Why would anyone in their right mind try to blame someone who might ??? have information that would help them when they try to sue a third party. Even someone of average intelligence can work why you would not want to do that....at this stage. The CBA is the only avenue for the storm investors to recoupe some of the money that this has cost them. Let ASIC identify the blame....

So it doesn't really matter who was at fault - all that matters to SICAG is that it gets as much money from the banks as possible, in any way it can?

I bet a few CBA shareholders would be pretty p*ss*d off at having to take the burden for this just because 'the bank is the only one with any money left'.

Storm pushed investors into irresponsible investment practices. Storm was knowingly complicit in pushing investors to misrepresent their asset values and incomes. Storm created the investment model and Storm failed to adequately manage and monitor this highly risky investment strategy.

Storm is the responsible party.

The banks and bank shareholders aren't responsible for cleaning up the mess that Storm made.

 

[GumbyLearner]

So it doesn't really matter who was at fault - all that matters to SICAG is that it gets as much money from the banks as possible, in any way it can?

I bet a few CBA shareholders would be pretty p*ss*d off at having to take the burden for this just because 'the bank is the only one with any money left'.

Storm pushed investors into irresponsible investment practices. Storm was knowingly complicit in pushing investors to misrepresent their asset values and incomes. Storm created the investment model and Storm failed to adequately manage and monitor this highly risky investment strategy.

Storm is the responsible party.

The banks and bank shareholders aren't responsible for cleaning up the mess that Storm made.

Oh I don't think it's that unreasonable on CBA or it's holders. They are just as obliged through themselves or agents acting on their behalf to make adequate inquiries into the capacity of repayment to whom they lend and whether it can be paid back. Lenders are subject to laws too you know.

Just my

DYOR

 

[specialed]

This post to me highlights the lack of understanding by Storm clients of their own and/or Storm's responsibility in this process.

Who was responsible for monitoring the investments of Storm clients - was it Storm or was it the client? - because it certainly wasn't the bank.


The margin loan was a debt product used by Storm clients to leverage into investments. The bank provided the debt product - in providing a debt product it doesn't have any responsibility to the recipient of that product for managing the investments made with that debt product.

The bank is only responsible to its own shareholders to ensure that they minimised the losses from deteriorating assets (i.e.debt products). The best way for CBA to minimise losses is to make a margin call as early as possible - therefore CBA failed in its duty to itself/its shareholders as far as I can see.

It is whoever was meant to be monitoring the investments that failed the Storm investors.

Investors have a responsibility to themselves for monitoring their investments and their debt servicing obligations ... not banks.

Investors have a responsibility to themselves to ensure they adopt gearing levels that they are comfortable with and only take on risks that they are comfortable with and only take on debt that they can comfortably service.

Banks have a responsibility to their shareholders to increase their assets (i.e. selling debt products) while also monitoring asset quality and taking action if asset quality deteriorates. The bank failed its shareholders by not making early margin calls and thus increasing their losses - the bank didn't fail investors - investors failed themselves.

So if the investors were relying on Storm to advise them and relying on Storm to monitor their investments - then Storm failed the investors - not the banks.

Margin calls are a safety net. Its not a good investor that relies on a bank making a margin call to decide to sell down a portfolio. Portfolio management by debt default - never heard of that as a succesful investment strategy. Was that Storms investment model? Invest as much as you can and only sell down if forced to by a bank making a margin call? If so thats a terrible investment strategy.

Interesting analysis....and certainly food for thought..However the banks certainly minimised the losses to their shareholders...when the margin calls are finally made not only do they get the houses used to secure the loan...they charged a premium breakfee for breaking the loan agreement. Net result to the banks...a nice christmas cash boost when they needed it and bunch of assets in the form of houses which they then "negotiated" to allow the customers to stay in till they die, and then the banks will take them with the capital growth..

As a shareholder I am more concerned at what this investigation continues to turn up with respect to the cba, concerned that they needed to issue a mea culpa, concerned at the irregularities in their submission and finally, concerned that the information contained within commsec may also be only "mostly accurate" most of the time. How many other products have they sold to investors that are not what they seem ????

 

[specialed]

Oh I don't think it's that unreasonable on CBA or it's holders. They are just as obliged through themselves or agents acting on their behalf to make adequate inquiries into the capacity of repayment to whom they lend and whether it can be paid back. Lenders are subject to laws too you know.

Just my

DYOR

The shareholders should be p...off that their bank has risked its share price with dodgy practices...what else will they do that is risky....

 

[GumbyLearner]

Interesting analysis....and certainly food for thought..However the banks certainly minimised the losses to their shareholders...when the margin calls are finally made not only do they get the houses used to secure the loan...they charged a premium breakfee for breaking the loan agreement. Net result to the banks...a nice christmas cash boost when they needed it and bunch of assets in the form of houses which they then "negotiated" to allow the customers to stay in till they die, and then the banks will take them with the capital growth..

As a shareholder I am more concerned at what this investigation continues to turn up with respect to the cba, concerned that they needed to issue a mea culpa, concerned at the irregularities in their submission and finally, concerned that the information contained within commsec may also be only "mostly accurate" most of the time. How many other products have they sold to investors that are not what they seem ????

Read the Bris Connections thread, it's full of commsec anomalies.