Storm Financial Group

Garpal Gumnut said:

From the article above.

Oh dear Solly, it looks as if 2011 is on.

I had to go down to a meeting in Lennons today and was given a room to freshen up. I must admit I was shocked by the state of the hotel. Much below my standards.

May we change the venue for the get together to the Marriott on the upper floors. There is an elite area with wifi, free brekkie, newspapers and drinks after a long day, I am told.

I have a mate who runs a limo service and he can get us up to the courts in 5 minutes.

gg

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GG,


I am thinking the Stamford, lovely "digs", outstanding view, and just a short stroll via the lovely Brisbane RiverWalk" to the courts , where we can chat with the "silks" on our way !!!

Founders got $2m as Storm Financial struggled

IMAGINE Mark Barrett's shock. In December last year, as he worked 18-hour days, and weekends, to try to keep Storm Financial afloat while the company's losses kept piling up, the company's chief financial adviser arrived at Storm's modernist Townsville headquarters after only a few hours sleep to find that his bosses had quietly pulled out $2 million for themselves while deciding who to sack within the company.

To say it's not a good look for Emmanuel and Julie Cassimatis is an understatement.

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There has been a lot of attention so far on Emmanuel Cassimatis, largely because he's been the only one who's publicly fronted. Yesterday was the first time his wife's role and activities in the company were put under the spotlight, and it was not a pretty picture.

The Cassimatises have pointed the finger at the big banks, arguing they are the villains of the piece. All parties would appear to have a case to answer in the case of the Storm collapse. But on continuing to pose as the champion of their clients, the fatal case against the Cassimatises is this: at a time when their clients were losing their savings, they looked after themselves first.

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http://www.theaustralian.news.com.au/story/0,25197,26202186-5013479,00.html

Well, well. Without a doubt, these allegations must come as a total surprise to any supporters of E & JC.

"Storm directors feared breach"

"An outstanding tax bill of $11.2m heralded Storm Financial's "difficult" financial position. · The Federal Court is examining the firm's joint chief financial officers."

Read more by Michelle Singer in The Australian Financial Review of Tuesday, 13 October 2009.

Judd said:

http://www.theaustralian.news.com.au/story/0,25197,26202186-5013479,00.html

Well, well. Without a doubt, these allegations must come as a total surprise to any supporters of E & JC.

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As reported in the link Judd posted above, I find this amazing that when in the opinion of Mallesons Stephen Jaques and PricewaterhouseCoopers these firms believed that EC & JC had no claim to the $2m payment, yet they didn't respond to return it. I suppose when you are running the show opinion is just opinion.

But I have always found it unusual that a dividend was paid even when the company failed to list.

I believe that there are some very interesting times ahead.....

"Storm co-founder allegedly pushed up bank transfer to $2m"

More on the ABC here;

http://www.abc.net.au/news/stories/2009/10/13/2712737.htm

Have just been to a seminar with a financial planner and the first two things he said to the audience was

''As a financial planner

1. You have to understand the clients financial position.

2. You have to justify why you gave that advice.''

Why and how did the storm operatives manage to bypass this concept and still maintain their financial planning license.

Why did the FPA approve of storms advice and maintain them as members of their association until it was too late, why couldn't they see storms advice for what it was long before this occurred.

If storm was well known in financial planning circles for it's aggressive advice why wasn't something done about it long before the inevitable occurred.

For those on this forum who think that we are only blaming the banks that is definitely not the case. As we are becoming more educated in the financial planning process it is obviously clear to everyone just how culpable this so called financial planning company was in the whole debacle.

I look forward to the day when each and every one of this company's owners and advisors are convicted for the fraudulent activity that they have conducted and the lives that they have destroyed with their lies and greed.

I don't see us as being greedy we only wanted to make our money work for us so that we could retire in comfort without having to rely on the old age pension and needed the help of a financial planner to do that.

Again I would like to ask the question

'Why and how could they continue to operate as financial planners when to all intents and purposes everyone in the know knew that they weren't?'

'Why did all of the banks involved with them so willing to lend them the obscene amounts of money that they did?'

We have only needed to borrow money once from a bank and we were well scrutinised and had to prove beyond a shadow of doubt that we could repay principal and interest.

I know that this is a stock forum and that many of you rely on your bank stocks for income but it's a shame that the banks didn't think of you as their shareholders and us as their clients before lending so indiscriminately to a rogue outfit such as storm.

It will be interesting to see the truth being exposed during this inquiry. EC and JC did look after themselves first. I cannot imagine anyone who cared about their clients paying themselves two million in bonuses while everyone else goes down the gurgler.

Even when his website was up and running for five minutes earlier in the year someone asked him the question about how he felt now that his clients were so badly affected and his answer sickened me to the teeth. 'I've lost more money than anyone'...well what this man needs to realise is that he's the big financial planner who chose to take the risks and we were the ones seeking a risk free investment, I think there maybe a little difference there. There is no way this man or his wife left their money in the market they made sure they were ok first even as the market dropped.

His advisors may not have all been registered but they were all financially savvy enough to see what was happening to the market and I bet they took their investments out at the right time and left ours in ....that was their income. They were supposedly under orders from the head honcho to make sure that our investments were not cashed in.

When our investments were cashed in they were at their lowest possible price and our LVR's were allowed to go well beyond the 100% before a margin call, unheard of unless someone wanted it to happen that way. Who would have been in the know enough to buy millions of shares flooding the market ...perhaps someone who had cashed in their own shares before they dropped and knew what would happen to ours perhaps.....

you have to also remember that the more the bank lent the more they meet their target

the mortgage brokers make money too on "hidden commissions" i.e if you were to take out a mortgage loan for $300,000 the mortgage broker would receive $1800 for selling this loan to you. (its roughly 0.60%) of the loan amount.

Only difference between a financial planner and a mortgage broker is that we have to disclose all fees and commissions while the mortgage broker doesn't.

So as you can see the more they lent to ppl the more they get in commissions.

Seems it all comes down to monetary greed doesn't it, for the so called planners, for the banks, for everyone involved in this sorry mess, except the people who wanted genuine financial advice...

yes thats unfortunately the way you can look at it,

there will always be cowboys in the industry no matter what they do, ASIC now wants to move to fee for service advice,

i charge my clients a fee for service, its a lot more transparent and i can give impartial advice, not flog some investment product cause it gives me more commissions.

i dont work for any bank and so i can offer a range of investments not something only from xyz bank, i work through a small licensee as i am basically a one man band and i prefer to keep it that way, id rather have 50 good quality clients then 8000 clients who wont get any service or "advice".


commissions is a dirty word.

Good to know there are some genuine people in the industry just wish we'd found a genuine one instead of the storm. I met a lovely financial planner today who like you said much the same thing. We double checked with storm to make sure this was a safe risk free investment, I thought people could go to jail for selling a fraudulent product, let's hope I'm right.

yea i'd love to describe here what i think of EC but i better refrain from it.

these lowlife scum shouldn't share the same air we breathe.

Harleyquin said:

Seems it all comes down to monetary greed doesn't it, for the so called planners, for the banks, for everyone involved in this sorry mess, except the people who wanted genuine financial advice...

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clayton4115 said:

yea i'd love to describe here what i think of EC but i better refrain from it.

these lowlife scum shouldn't share the same air we breathe.

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Just hang in there , the end is in sight. Scattini and the lawyers have done a good deal with CBA and I expect BOQ to come to the party.

Don't wait however for the Cassimatises to get their "just deserts" as described above.

Through a number of factors, mostly lack of street smarts and blind allegiance to a failed model, SICAG have set a scenario for them to get off with very little penalty, possibly a suspended sentence or a few months in a low security facility.

My reasons for saying this are.

1. SICAG is based in Redcliffe or the Sunshine Coast with the fewest investors affected, rather than in Townsville where the most information about the scam is available, and the most victims live.

2. The Committee is tainted by the presence of a former Storm executive and a former Storm Advisers relative. This is a conflict of interest and has governance implications.

3. SICAG consistently state that members have connections with the Cassimatises but that this in no way affects their decisions or web page. Why then have no adverse public appearance by Julie or Manny in inquiries and court not been reported by SICAG.

4. The SICAG website consistently advises victims to avoid advisers who charge by the hour "unlike Storm". The charge by the hour model is the preferred model of interaction between client and adviser, promoted by all experts in the area.

gg

Harleyquin said:

Have just been to a seminar with a financial planner and the first two things he said to the audience was

''As a financial planner

1. You have to understand the clients financial position.

2. You have to justify why you gave that advice.''

Why and how did the storm operatives manage to bypass this concept and still maintain their financial planning license.

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More than likely Storm didn't. Probably all buried in the 100 pages called the Statement of Advice. Bet you it ticked every single compliance box invented. Trouble is there is a world of difference between ticking the compliance boxes and holding certain ethical values.

Harleyquin said:

Why did the FPA approve of storms advice and maintain them as members of their association until it was too late, why couldn't they see storms advice for what it was long before this occurred.

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Probably did not and does not have the legal authority to approve anything associated with any financial planner or their business model. People seem to think that these industry bodies approve this or that if someone is a member of that body. Got nothing to do with it I'm afraid. The FPA and all other industry representative bodies are just a PR front - a bit like unions claiming to represent workers interests.

Harleyquin said:

If storm was well known in financial planning circles for it's aggressive advice why wasn't something done about it long before the inevitable occurred.

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When all was going swimmingly well for Storm clients, if other financial planning firms shouted out that it should be shut down, the screams of protest from Storm clients in Townsville would have been heard in Hobart. In any case, ever been slapped with a writ for defamation or slander? What do you think EC & JC would have done if other planning firms came out in public with strident critisism of the Storm ethics on the upfront fee and/or its business model?

Harleyquin said:

For those on this forum who think that we are only blaming the banks that is definitely not the case. As we are becoming more educated in the financial planning process it is obviously clear to everyone just how culpable this so called financial planning company was in the whole debacle.

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Sadly, sometimes it requires a lot of hurt to be inflicted before the "Ah Ha!" moment occurs. Equally sadly, it is my feeling that quite a number of families and individuals maybe hurt so badly that they will not recover.

Harleyquin said:

I look forward to the day when each and every one of this company's owners and advisors are convicted for the fraudulent activity that they have conducted and the lives that they have destroyed with their lies and greed.

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Let the courts decide on this. Individually we all have our own views on how justice should be served but I prefer the court system as it is all that stands between us and anarchy.

Harleyquin said:

I don't see us as being greedy we only wanted to make our money work for us so that we could retire in comfort without having to rely on the old age pension and needed the help of a financial planner to do that.

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All wishes and attempts to improve one's lot involves some element of greed otherwise you would just stay as you are. However, apart from a very few, I don't consider the vast majority of Storm clients were or are greedy in the usually accepted meaning of that word.

Harleyquin said:

Again I would like to ask the question

'Why and how could they continue to operate as financial planners when to all intents and purposes everyone in the know knew that they weren't?'

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See response above.

Harleyquin said:

'Why did all of the banks involved with them so willing to lend them the obscene amounts of money that they did?'

We have only needed to borrow money once from a bank and we were well scrutinised and had to prove beyond a shadow of doubt that we could repay principal and interest.

I know that this is a stock forum and that many of you rely on your bank stocks for income but it's a shame that the banks didn't think of you as their shareholders and us as their clients before lending so indiscriminately to a rogue outfit such as storm.

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While I understand and appreciate your position it is an emotive one. The sole purpose of the banks is to assist with the flow of money to those who apply for it and make a profit by charging interest. They do not exist to to make moral judgments but maybe that will change. Storm was a business and for quite sometime a profitable one. As was Babcock & Brown, ABC Learning Centres, Centro and a host of other business big and small which have gone or almost gone belly up. So why wouldn't banks lend to the corporate or business Storm as they do to any other corporation provided it is legal?

gg, looks like we'll have to leave it to Harry......

Solly said:

gg, looks like we'll have to leave it to Harry......

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lol mate.

Harry Gibbs and the Storm Stoned.

Might make a good book or movie.

Its heading for the cuffs and no tie, no belt walk.

gg

darkside said:

GG,


I am thinking the Stamford, lovely "digs", outstanding view, and just a short stroll via the lovely Brisbane RiverWalk" to the courts , where we can chat with the "silks" on our way !!!

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Speak to Solly about the Stamford.

I stayed there when it first opened and again about a year ago.

It had gone from a gran tourismo, to tourismo.

The carpets on the grand stairs were frayed and I felt uncomfortable in the presence of Japs, Canucks, and Yanks on the grand tour.

Not that I've got anything against the forenamed. But ****, they do drag a lot of luggage into the lifts.

I will bow to the opinion of all.

Latest update is August 2011 for the Harry's, so we need to book soon to get the best rates for a floor.

I'd still go for the Marriott.

Lennons looks tired and the Indian taxi drivers can't find it unless you say Shuffley.

gg

Garpal Gumnut said:

Speak to Solly about the Stamford.

I stayed there when it first opened and again about a year ago.

It had gone from a gran tourismo, to tourismo.

The carpets on the grand stairs were frayed and I felt uncomfortable in the presence of Japs, Canucks, and Yanks on the grand tour.

Not that I've got anything against the forenamed. But ****, they do drag a lot of luggage into the lifts.

I will bow to the opinion of all.

Latest update is August 2011 for the Harry's, so we need to book soon to get the best rates for a floor.

I'd still go for the Marriott.

Lennons looks tired and the Indian taxi drivers can't find it unless you say Shuffley.

gg

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gg, I don't mind the Stamford but the lure of the Port Office across the road may be a bit too much of a temptation and cause a distraction, wouldn't want to miss any of the proceedings.

I hear the Sofitel is also pretty swish since the refurb, it's just a short stroll down Turbot to Harry's place.

I'm still open to suggestions.

Harleyquin said:

I met a lovely financial planner today who like you said much the same thing. .

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"A lovely financial planner"? What made him 'lovely' Harleyquin?
You are obviously in an (understandably) emotional state. I'd honestly hope that you would stay away from any financial planners (thought you were broke, actually) until you are in a more stable frame of mind and more able to make an objective evaluation of what anyone is offering.
I would imagine that at the moment, anyone who says the right words, and has a sympathetic attitude would seem pretty much 100% to you.

Sorry if this sounds unsympathetic, even unkind, but I can see the very real possibility of you being taken for a sucker all over again.

Judd said:

Probably did not and does not have the legal authority to approve anything associated with any financial planner or their business model. People seem to think that these industry bodies approve this or that if someone is a member of that body. Got nothing to do with it I'm afraid. The FPA and all other industry representative bodies are just a PR front - a bit like unions claiming to represent workers interests.

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Exactly. Harleyquin, I think you have quite the wrong idea about the usefulness of this so called professional body. It is not their role to vet what is being offered to clients.

When all was going swimmingly well for Storm clients, if other financial planning firms shouted out that it should be shut down, the screams of protest from Storm clients in Townsville would have been heard in Hobart. In any case, ever been slapped with a writ for defamation or slander? What do you think EC & JC would have done if other planning firms came out in public with strident critisism of the Storm ethics on the upfront fee and/or its business model?

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Spot on, again, Judd. None of the Storm clients were complaining about the business model while they were making money.

Let the courts decide on this. Individually we all have our own views on how justice should be served but I prefer the court system as it is all that stands between us and anarchy.

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Yes. And there are enough separate enquiries going on for the truth to eventually be made clear. Must be a hellishly difficult waiting time for Stormers, though.

While I understand and appreciate your position it is an emotive one. The sole purpose of the banks is to assist with the flow of money to those who apply for it and make a profit by charging interest. They do not exist to to make moral judgments but maybe that will change. Storm was a business and for quite sometime a profitable one. As was Babcock & Brown, ABC Learning Centres, Centro and a host of other business big and small which have gone or almost gone belly up. So why wouldn't banks lend to the corporate or business Storm as they do to any other corporation provided it is legal?

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Again, completely true.

Harleyquin, we understand how upset you are, but business is business and - unless specifically employed for that purpose, e.g. giving advice via their own inhouse financial advisers - banks do not fill the role of financial planners.
That was Storm's responsibility.

Harleyquin said:

We double checked with storm to make sure this was a safe risk free investment,

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In all logic, if you were borrowing against your home, and then taking a margin loan against that borrowing, how could it possibly be a 'safe risk free investment'!!