Australian (ASX) Stock Market Forum

Storm Financial Group

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Harleyquin said:
That's right Specialed SICAG was started near Brisbane but those of us who have joined SICAG and live elsewhere can contact all of the Committee at any time by email or phone and they are amazingly patient people despite being in the same position as we all are. The Committee are to be congratulated for their work and SICAG members are able to support each other emotionally. We don't need the ASF for emotional support as we have all the support we need elsewhere.
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I'm a bystander in all this and find the "Storm Model" incredibly dangerous. Banks are ar***oles. They will screw you at any opportunity. Never trust them, most are fools.

I just had a quick look at the SICAG website and at a glance it only blames the banks - it does not mention EC and JC at all. Please advise if I am missing something. Banks you have to expect to be ruthless and after your dough (I mean they are just money lenders after all) whereas your PERSONAL financial adviser is meant to LOOK after your money. Protect you from yourself and the vultures.

Good luck getting anything from them but personally I am not surprised by their behaviour. I think anyone who has had dealings with Banks (other than a home loan) knows what I'm talking about.
 
TOBAB said:
I'm a bystander in all this and find the "Storm Model" incredibly dangerous. Banks are ar***oles. They will screw you at any opportunity. Never trust them, most are fools.

I just had a quick look at the SICAG website and at a glance it only blames the banks - it does not mention EC and JC at all. Please advise if I am missing something. Banks you have to expect to be ruthless and after your dough (I mean they are just money lenders after all) whereas your PERSONAL financial adviser is meant to LOOK after your money. Protect you from yourself and the vultures.

Good luck getting anything from them but personally I am not surprised by their behaviour. I think anyone who has had dealings with Banks (other than a home loan) knows what I'm talking about.
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Tobab

Indeed you are correct, and not only do SICAG not mention EC and JC, they actually endorse the "storm" MO

Before you commit to anything, ask about fees!
Remember, the Storm Fees model charged nothing for discussions until something was actually done. Most of the financial planning industry charge fees for each appointment regardless of outcome!"

To get your head around it ,most of the financial planning industry are not in court over gross neglegence or missapropriation of funds either, so i would be happier with a company that didn't gamble my house and leverage me to the hilt, but charged for genuine financial advice.

And before Max and all the SICAG followers berate me and send me evil PMs again, pick one part of my post that isn't factual , then post it ,then you can send me evil PMs. !!!!!
 
Everyone has a different opinion on what is and what isn't good financial advice and the same can certainly be said for all members of SICAG. There are many who support the Storm model just as there are many who do not, it just depends on your age and circumstances. What does it matter is some members of SICAG endorse the storm model, I think the point is that it was not suitable for every client and this is what occurred. We have written evidence where we have asked for a risk free investment and obviously the storm model does not meet our criteria and yet we had no idea that it was so dangerous at the time, we do know now however.

One of the biggest 'mistakes' that storm financial made was to mortgage the homes of their clients, many of whom had asked for a less risky investment option, thus putting them at risk and at the same time telling them that their homes would be safe. In fact it now appears that there was no such thing as a low risk investment and yet we had to fill out paperwork so that they knew what level of risk and reward we were prepared to accept. OK if your an educated punter then you know more about the risks than those who aren't.

The storm model did not endorse high risk / high return investments they endorsed their own index funds which tracked the whole market. They only promised 'average market returns,' and this is why there are some investors who liked this type of investment. From a young persons point of view it often worked well as they had no assets at risk and they started small and their risk was not so great.

As I understand it the whole thing collapsed when the market was not being monitored correctly, in fact, there is growing evidence that the CGI monitoring system was on the blink for a month over the critical period September - October 2008. This allowed clients LVR's to rise blow out of all proportion and placed many clients in negative equity.

I have been looking into our paperwork and I'm no expert at reading 'financial or legal speak' but there appears that we should have been notified by the bank when we were in margin call. Twelve months after the event we are still waiting for that call from the bank they have never notified us that we were in margin call.

Most Aussie banks subscribe to the ABA code of conduct and this states quite clearly where the banks responsibilities lie. There is also an increasing body of evidence to suggest that many of the banks had adopted lax / poor banking industry standards when dealing with storm financial.

It may not mention EC and JC by name on the SICAG website but I'm sure that it mentions Storm Financial and that they will look at whether poor financial advice was given as well as the banks involvement.

In the US they have called this type of lending sub prime lending and it's what got the world into this crisis in the first place.
 
Harleyquin said:
Everyone has a different opinion on what is and what isn't good financial advice and the same can certainly be said for all members of SICAG. There are many who support the Storm model just as there are many who do not, it just depends on your age and circumstances. What does it matter is some members of SICAG endorse the storm model, I think the point is that it was not suitable for every client and this is what occurred. We have written evidence where we have asked for a risk free investment and obviously the storm model does not meet our criteria and yet we had no idea that it was so dangerous at the time, we do know now however.

One of the biggest 'mistakes' that storm financial made was to mortgage the homes of their clients, many of whom had asked for a less risky investment option, thus putting them at risk and at the same time telling them that their homes would be safe. In fact it now appears that there was no such thing as a low risk investment and yet we had to fill out paperwork so that they knew what level of risk and reward we were prepared to accept. OK if your an educated punter then you know more about the risks than those who aren't.

The storm model did not endorse high risk / high return investments they endorsed their own index funds which tracked the whole market. They only promised 'average market returns,' and this is why there are some investors who liked this type of investment. From a young persons point of view it often worked well as they had no assets at risk and they started small and their risk was not so great.

As I understand it the whole thing collapsed when the market was not being monitored correctly, in fact, there is growing evidence that the CGI monitoring system was on the blink for a month over the critical period September - October 2008. This allowed clients LVR's to rise blow out of all proportion and placed many clients in negative equity.

I have been looking into our paperwork and I'm no expert at reading 'financial or legal speak' but there appears that we should have been notified by the bank when we were in margin call. Twelve months after the event we are still waiting for that call from the bank they have never notified us that we were in margin call.

Most Aussie banks subscribe to the ABA code of conduct and this states quite clearly where the banks responsibilities lie. There is also an increasing body of evidence to suggest that many of the banks had adopted lax / poor banking industry standards when dealing with storm financial.

It may not mention EC and JC by name on the SICAG website but I'm sure that it mentions Storm Financial and that they will look at whether poor financial advice was given as well as the banks involvement.

In the US they have called this type of lending sub prime lending and it's what got the world into this crisis in the first place.
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FWIW I think the storm model was ok, but required less gearing, and to eg limit that gearing for retirees and increase it for young people etc.

Storm DID NOT only aim for market returns, they aimed to outperform, otherwise there would be no gearing required. They clearly stated this in their "education" seminars.

The banks may not have been giving 100% accurate information, but come on people, anyone who believes that EC et al were stupid enough to not know that these people were margin loan forget 2 things

1. They were index funds - it is easy to have a ballpark assessment

2. EC tried to negotiate with the banks to go easy on his clients - ie he admitted he knew they were doomed ( at that point of time ).

I am no sophisticated investor, yet was querying this with Storm investors around the time of the stockmarket turmoil. Why was EC not doing the same - because he knew Storm would go broke faster if he sold people out at an appropriate time.
 
DocK said:
Harleyquin,

It makes you feel better. The experts will tell you about endorphins etc, and it's true. I find once I make myself make the effort, I really do feel much better. When you're walking in the early morning with the sun on your face, the birds chirping away madly, some music in your ears etc, it's easier to remember that being broke needn't be the end of the world, and you still have something to be grateful for - even if it's only the fact that you're still upright and breathing.

My pants are still too tight, but I plan to haul out my son's old punching bag and tape a photo of a certain couple from up north on it - no telling how skinny I'll wind up before I'm sick of belting it!!:eek:
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Good for you, DocK. There have been several studies demonstrating that exercise can be more helpful than medication in counteracting depression.
Here is a link to just one of these trials:
http://www.pponline.co.uk/encyc/0898.htm
There is more evidence out there for anyone who is interested.
I've personally used sustained aerobic exercise as an antidote to anxiety to great effect for many years.
Keep it up and all the best.


DocK said:
At any storm "education seminar" it was always emphasised that investing in property was always a poor choice
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Any such blanket generalisation would immediately alert me to something being amiss. I'm sure many of us have made considerable money out of property.

I guess it's hard to collect a trailing commission on a property investment....
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Yep, exactly.



Harleyquin said:
As I understand it the whole thing collapsed when the market was not being monitored correctly, in fact, there is growing evidence that the CGI monitoring system was on the blink for a month over the critical period September - October 2008. This allowed clients LVR's to rise blow out of all proportion and placed many clients in negative equity.
Click to expand...
Can't just blame CGI. As has already been pointed out, there were several items on the news every single day about the pending financial crisis.

I have been looking into our paperwork and I'm no expert at reading 'financial or legal speak' but there appears that we should have been notified by the bank when we were in margin call. Twelve months after the event we are still waiting for that call from the bank they have never notified us that we were in margin call.
Click to expand...
We've been over this many times, and various Stormers have said that they delegated Storm to be their contact point with the bank, or alternatively Storm told the clients they would look after any margin calls. If that were the case, as we have also repeated many times, then there would have been in place an arrangement between the bank and Storm, not the bank and the client.

In the US they have called this type of lending sub prime lending and it's what got the world into this crisis in the first place.
Click to expand...
I don't think what happened here is the same as the US subprime model at all. That was more designed to get people who had not previously owned any property into their first homes. There is no evidence of that happening with Storm. On the contrary, Stormers all appeared to have fully paid off homes.
 
"In-house advice backed shares"

"Storm Financial advisers urged clients to invest in the sharemarket rather than property or cash as the company's in-house research showed it was the more reliable market in which to place money."

Read more by Michelle Singer in The Australian Financial Review of October 15 2009
 
"Double trouble brewing for BoQ"

"Bank of Queensland could be facing a coalition of disgruntled owner-managers and Storm Financial clients seeking compensation for losses because of representations made to employees or products sold to customers."

Read more by Duncan Hughes in The Australian Financial Review of October 15 2009.
 
"Storm adviser didn't care, argues barrister"

"LAWYERS for the Storm Financial liquidators have accused one of the company's former advisers of not caring if the investment advice he provided to a retiring couple was based on inaccurate information.

The Brisbane adviser, Stuart Drummond, became involved in a heated exchange with the Worrells barrister Craig Wilkins ........"

More by Daniel Hurst in the SMH Business Day here;

http://www.smh.com.au/business/storm-adviser-didnt-care-argues-barrister-20091014-gxhc.html
 
"Fines 'unlikely' to help Storm investors"

"A corporate law academic believes former Storm Financial investors are unlikely to benefit from any criminal action against the Townsville-based company's founders.

Under the Corporations Act, trading while insolvent can be prosecuted as a criminal matter and attract substantial fines and prison sentences."

More from Murray Cornish on the ABC here;

http://www.abc.net.au/news/stories/2009/10/14/2713494.htm
 
TOBAB said:
Ha. More front than Myers!
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Ironhalo said:
So despite a Masters in Finance she doesn't know what the word 'insolvency' means?

This is almost too funny.
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darkside said:
Ironhalo!,

Your a hard marker, she may have been away the day they taught insolvencey and it's ramifications at uni.
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Ms Collette, who holds a Masters degree in Applied Finance
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I have not laughed so much since I saw the second Mrs Gumnut's mother, my ex mother-in-law, fingered on Border Security for trying to take a suitcase full of Hungarian salami in to this green and pleasant land.

It proves beyond a doubt that the Financial Planning industry should be abolished and that Financial planning should be taught from Y1 in Primary school, through to Y12 in High School.

Ms.Collette may hold a Masters , but its in something else which I'd prefer not to put in print, it pertains to the male eater of grass of the species bovus and the end product of same.

gg
 
darkside said:
Ironhalo!,

Your a hard marker, she may have been away the day they taught insolvencey and it's ramifications at uni.
Click to expand...

She obviously skipped the day they taught about directors obligations as well.

Appointed as a director and signs off on a $2 million dividend payment on the day she was appointed ... to her sister. Were these people really so ignorant and amateurish that they could possibly have thought they could get away with this? Its a joke, they must have been suffering from some kind of delusions or living in a fantasy world (they probably still are).
 
What I'd like to know is where the SICAG Model stands now with all this drivelling effluent pouring over the governance at Storm headquarters.

sicag.info has taken down their disclaimer about the Cassimatis clan, but still have their money spider distracting people from information.

And they still advocate a "no fee model such as Storm"

Its time that sicag explained to aussiestocksforum, which is where most Storm victims get independent advice, where they stand on the recent court proceedings.

gg
 
Garpal Gumnut said:
What I'd like to know is where the SICAG Model stands now with all this drivelling effluent pouring over the governance at Storm headquarters.

sicag.info has taken down their disclaimer about the Cassimatis clan, but still have their money spider distracting people from information.

And they still advocate a "no fee model such as Storm"

Its time that sicag explained to aussiestocksforum, which is where most Storm victims get independent advice, where they stand on the recent court proceedings.

gg
Click to expand...

Garpel you previously stated...

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.

Exactly how is SICAG setting up a scenario for "them" to get off lightly ? I understand your problem with SICAG as you have articulated this well and consistently. But please explain how SICAG is going to influence the findings of a Senate inquiry, an ASIC inquiry and the Worrells Inquiry in such way that any penalties against the Cassimatises are minimised. I fail to see how the four points you listed after the above quote can have any influence on penalties when they are handed out. It is absurd to suggest that this group is attempting to reduce any penalty against the Cassimatises. How and Why exactly would they do this ?

SICAG is "based in Redcliffe or the Sunshine Coast" because this is where the founders live. Whether you live in Redcliffe, Townsville , Sydney or wherever you are still able to participate with the Group. Hence their visits to Rocky, Cairns, Townsville, Mackay etc.

It is a shame that in your contributions to this forum Garpel, which are often very insightful and provide interesting analysis usually also contain a "shot" at SICAG which appears to be included for no other reason than to be a malicious attempt to discredit what they are attempting to do to support those who have chosen to join the group.

My understanding is that SICAG answers to its members, many of whom are in daily, if not weekly contact with the committee members. NOT to you or to ASF. I have yet to see you make any such ridiculous "explanation" demands of the banks, or for that matter Manny. Why dont you also demand that Ralph Norris logs on and answers your questions...Please....

As for this being the place where most storm victims get their independent advice, I suspect, but do stand to be corrected, that the number of SICAG members far outways the contibutors to this forum. Maybe its time you identified exactly why you continue to attack this group, for which no one has made you join nor has anyone else been forced to join. If you dont believe in what SICAG is doing, it simple you dont become a member. If your friends or relatives dont believe in what its doing, simple they dont become members. Unfortunately your continued attacks on SICAG are beginning to appear as nothing more than vindictive. If your not happy with what SICAG are doing, then just dont join them. Its a pity you could not put this much energy into investigating the legalities of the banks and storm rather than chasing a volunteer group, serving to support it members of which I assume you are not one. Man get over it...
 

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