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Storm Financial Group

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Frank the pupils want to learn but you aren't teaching the right lessons.

It is quite staggering that you continually overlook the role you played in this whole mess, and overlook it by absolving yourself of any responsibility at all. In fact, you completely ignore it as if it isn't there.

Look at what happened to you before the banks got involved. That's where people will learn what NOT to do, because the lesson you are teaching won't stop people from getting conned in the future.

I guess denying any responsibility is good for your case against the banks....admitting you made mistakes weakens your case that the banks led to your demise.
 
From the 2007 Prospectus.

Highlights of Section 4.3.2

Any comments ?

I'm very interested about the reference to Phormula in point 3.
 

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Judd said:
I
. One which really raised my hackles was that from a couple in their 70's, on Centerlink, home paid off and who wished to become "Self-Funded Retirees" (whatever that phrase means.)
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Nothing mysterious about it, Judd. It means exactly what it says: i.e. able to fund your own retirement without needing to access a taxpayer funded pension.
 
Harleyquin said:
Julia I really do appreciate the offer of help that you are extending
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The offer was extended about two years ago. It was not ongoing.
You have since made clear that you have absolutely fixed views, many of which are imo quite unjustifiable, so I doubt that anyone wanting to offer you an objective view of how to acquire financial literacy would have a snowball's chance in hell.

I prefer not to trust an internet contact no matter how genuine they appear, probably just me being over cautious, but today we have to be.
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Um, I was never trying to sell you something, HQ! What I was offering, and I stress "was", was nothing more than a sympathetic hand of objective assistance. I had no product to offer, no commission to be obtained, just an intention of pointing you toward a few sites where you could, if you just stopped the blame game and took a forward looking view for a bit, acquire some education.
 

Frank,

An "avartar" or more correctly, an avatar, is a 'picture' that forum members choose to use or not. I think mine may be more 'classy' than yours, but frankly, (excuse the pun), I don't give a damn.

A forum membership name is a pseudonym, one that the majority of forum members on whatever site choose to use to protect their anonimity.

I'm under no obligation to you, or anyone else, to disclose my real identity.

I am however under an obligation to myself to tell you, and the ASF members who read or post on this thread, that you do not have my permission to speak on MY behalf just because we both took up Storm Financial's advice for a self-funded retirment 'plan'.

Please believe me Frank, I am more than capable of speaking for myself. I do not need you, or anyone, to speak for me.

As to who's side I'm on? What side would that be? Personally, I don't understand most of your posts. They all appear to be self (Frank) serving.

Grow a set Frank! Speak for yourself, and feel confident about doing so.

Stop hiding beneath your mother's skirt petticoat, and just talk for yourself.

I'd still be interested to know just how many former Storm clients you represent.

I'd like to know, and I'm sure many others on ASF would, but am sure that you will not share how many members you have on your SOB site/forum.

So, Frank....

A challenge....

to the obviously 'english' knight you use for your avartar?

How many people have signed up for your 'forum', how many people have you actually 'interfaced' with personally?

Most importantly, how many people have given you their permission to speak on their behalf?

I speak only for myself, I would not speak for anyone else unless I had a written, legal, contract.

I do not want to detract from the content on this thread Frank, and am happy to continue our 'discussion' via PM.

I do need to reiterate however that you, Frank, do not need to speak out on my behalf on any forum or any other media.

MS
 


Solly said:
From the 2007 Prospectus.

Highlights of Section 4.3.2

Any comments ?

I'm very interested about the reference to Phormula in point 3.
Click to expand...

Some posts circa 2009. Whether the allegations are true or not I obviously don't know. If true the PDS could have been stretching the truth a touch.
 
Solly said:
From the 2007 Prospectus.

Highlights of Section 4.3.2

Any comments ?

I'm very interested about the reference to Phormula in point 3.
Click to expand...

Solly do you have a copy of the Prospectus? If so, how may one go about obtaining a copy? I would really like to have a read of it just for my own personal interest.

Cheers
 
Solly said:
From the 2007 Prospectus.

Highlights of Section 4.3.2

Any comments ?

I'm very interested about the reference to Phormula in point 3.
Click to expand...

Sure Solly,

I am not sure that the software referred to achieved that much. Probably a nice bit of marketing for the planned float. Adds a touch of prudence and finesse to the whole scheme.

Importantly though, it does NOT say that use of the Phormula software will provide data that will TRIGGER A MARGIN CALL for STORM clients. The failure to provide MARGIN CALLS remains, I am afraid to say, the BANK'S problem. Yes the software could probably do all sorts of things. BUT.....it did not in any way absolve the BANK of its responsibility to ITS client under the MARGIN LOAN TERMS AND CONDITIONS.

Any thoughts from you? Or does this observation not suit?
 

Don't you just love the BS in the whole attached image though.

I think we can all agree that the banks will be found to have failed in their obligations to issue the margin calls. They will be asked to bring clients back to a situation where they should have been if the margin call had correctly been made. This doesn't mean clients will get all their money back it will simply solve the negative equity issues. As I have mentioned the 90% level of the margin call means clients will at best be left with 10% equity and a home loan to repay. Got to love advice that puts you back 15+ years and tells you to start all over again paying down a debt you have already paid once. Worst part of that is for alot of clients the original mortgage might have been $100K but because the house went up in value to say $500K, Storm drew out $400K. So now not only do they have to pay their mortgage twice, the second time is most likely for multiple times what they first paid.
 

Hi Doobsy,

Not to disagree, you in fact are probably right, but the scenario you paint of what the BANK will be required to do i.e "reverse the negative equity position and put clients back to where they would have been had they received a MARGIN CALL at 90% LVR" - my understanding is that is what the Bank offered under its Resolution Scheme.

The reason this was not universally signed off on is because it did not address what clients would have done had they received a margin call from the BANK. Some may have needed to crystallize the losses and pay down their Margin Loan - no doubt. Although I have now seen 7 different processes by which this scenario could be averted. I know you answered a thread of mine regarding this question late last week. No problem with your calculations, but nor do I with the other proposals I have seen. Including offerings from reputable multinational accounting firms - you will know the names.

But, importantly, on receiving a margin call one option that you seem to dismiss is that of - wait for it - MEETING THE MARGIN CALL (number one option probably for some). So, I propose that the BANK may not be simply able to turn the clock back to 90% LVR and then caution all their clients to be careful and not "let the door hit you in the **** on the way out". They may have to look at each individual's position and ask the question: "What would you have done if we gave you a margin call". Then, with supportive evidence from the client, consider the answer.

What about that for yet another way to consider how things could be handled? Remember the BANK failed in its duty of care. You have conceded that. So why not legitimately correct the client's position - rather than the cheapest cut and run solution they can come up with? Sounds like maximum damage for the client with minimum damage to the shareholder. A nice way to look at things if you're the BANK. Any thoughts? Keep it civil now!
 

I apologised to you before but you want to carry this on! What's more you are becoming personal. Therefore, it seems that you have an axe to grind? Whatever, I'm not interested. One thing is for sure though. You are somehow connected with Storm. You wouldn't be this aggressive unless you were. Goodbye And I do mean "Goodbye!"
 
These last few weeks you’ve all had a bit of fun mostly at the Storm investors’ expense. That’s fair enough! However, I would now like to change direction and put the Australian financial advisory services industry in the dock. After all, Storm was a financial advisory firm and it did not operate in a vacuum, contrary to what most would have us believe.

When all this is finished, probably in 2013 or so, I intend to write a book. I’ll probably entitle it, “The Pitfalls of Investing in Australia by Someone that lost 1.7 Million in 15 Months” That should be an attention getter don’t you think! It certainly won't be doing your industry any favours!

Yes! I do have the credentials. (1) I’m a published writer, (2) I have been investing all aspects of financial advising these last three years, (3) we lost a fortune by placing our trust in a financial advisory firm, (4) I have studied contract law both in the UK and in Australia, (5) I was an advisory consultant for Government, and (6) I was in corporate management for 35 years. It’s probably a track record that few of you could match. You'll find proof of this on my 'Storming on Banks' website.

I have, as most have surmised by now, a very jaundiced view of the financial advisory sector and those that operate within. I have, I feel, a good reason for this! Nothing I have heard so far on this forum has changed that view up to now. However, I’m willing to listen if someone has something positive to say that may force me to re-evaluate my assessment. After all, if I find a publisher, my “tirades” will be listened to by a few and it means less business will be coming through the doors of financial advisers. In order to be fair though, I’m going to give the financial sector a chance to redeem itself on this forum. In other words, lets turn the spotlight on you!

I’m going to ask a series of questions in the hope that someone has the capacity to give me some sensible answers. You certainly don’t have to participate but your silence will indicate to me that any opinion you have about we Storm investors on this forum in future is just hot air. It should also indicate to any would-be investors that use this forum that they should be seeking other avenues to grow their money.

What did Doobsy say? "There is a need to educate investors" I couldn't agree more.

Here’s the first question and try not to fail at the first hurdle!

“Should investors when using a financial adviser ask to see details of that adviser’s ‘Professional Indemnity Insurance Policy’ and what should that person be looking for in it to reassure him/her that the adviser has adequate cover?”

When answering this, I would like you to state why Storm’s cover failed in this regard!

Have fun!
 
Frank Ainslie said:
Yes! I do have the credentials. (1) I’m a published writer,
Click to expand...
May I ask if you self published?

I have been investing all aspects of financial advising these last three years
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I don't understand this sentence. Do you mean you have been investing in all aspects of the last three years? The sentence as it stands doesn't make sense.

As far as I'm aware, most of us who have commented on this thread, other than Storm clients, are simply interested observers.

A couple of people who have made clear they are financial planners/advisers have made various posts which make clear their ethics and attitudes.

So I'm not quite sure what you're on about, to be honest.

Oh, don't be silly. None of us are in any way obliged to give you answers to anything. Just as no one has to identify themselves as you earlier demanded one poster should do.
 
Julia said:
....I don't understand this sentence. Do you mean you have been investing in all aspects of the last three years? The sentence as it stands doesn't make sense.
Click to expand...

Possibly Frank means investigating as opposed to investing. The sentence then makes sense. I could be wrong of course since he claims to be a published author and, therefore, would presumably be aware of the need for proofreeding [sic] before publishing.
 
More tripe I am afraid Frank.

You want forum participants to play your little game, yet continually refuse to answer simple questions put forward by others!

You were conned by a Greek in a sportsjacket Frank. Not every financial planning client has been through what you have, thankfully, so your generalisations about the industry are, like your refusal to take responsibility for YOUR DECISIONS, way off the mark.

You should title your book "How ignorance and gullability cost me $1.7 million in 15 months- a lesson in what not to do when managing your money". This would sell well.
 
Some home truths!

(Ross Greenwood 24/11/2009

"There has always been a fundamental flaw in the way financial planning works in this country.

It's been there for the past 25 years that I have reported on it. And that flaw remains at the very heart of a conflict that exists between most (more than 80 per cent) of so-called financial planners and their clients.

Now, after billions of dollars of investors money has been lost, wasted or, worse, stolen the Government finally has a set of recommendations that could make a change for the better.

Bernie Ripoll's parliamentary inquiry was created nine months ago to investigate the financial services industry in the wake of the collapse of Storm Financial, Opes Prime and the Gold Coast property firm MFS. But it might as well have been the collapse of Timbercorp, Great Southern, Fincorp, Westpoint, Australian Capital Reserve or, going back, Estate Mortgage Managers or Australia-Wide Property Trust.

In every case, bar none, the losses that wracked investors were created by high-risk (often debt-laden) underlying investments that were sold to an unsuspecting public by advisers who were paid well above average commissions by promoters. It's as simple as that.

The Ripoll committee's conclusion is that Government should take urgent action to negotiate with major fund providers (read the banks and the big insurance companies) to cease the commission structures in the industry. That will be a start. But there's another recommendation from Ripoll's committee that is even more fundamental.
To many reading this, you would imagine this should have been a given before the financial advice industry started 30 years ago. But no. It's this. Financial planners and investment floggers are under no obligation to put your interests first.

In other words, even though they recognise there might be a financial product that is more appropriate to your needs, they are not obliged to sell it to you. In fact, if it is in their interest to sell you a product that pays a higher commission, they are at liberty to do so (provided the commission is disclosed).

So now think how many customers of Storm Financial "planners" were inappropriately plunged into a scheme that saw them borrow money against their own homes to in turn use that as a deposit to borrow more money to invest in the stockmarket.
The fact that some of these "victims" were retired and with limited income only highlights the inappropriateness of the advice.

That fact that Storm paid well above average commissions to these salespeople (who double-dipped on the fees because of the double-gearing effect of the strategy) again highlights the conflict that rests within the entire industry.

And a chart that accompanied the report shows that if you head to your trustworthy bank or financial institution's advisory firm, you run an 80 percent chance that you will be recommended to put your money with that same organisation.

Again there could be better products for your needs elsewhere, but that's not where you will end up.

But don't think it's just the big banks. Recently I attended a conference of a group of highly reputable and independent financial planners. As they started the conference they were asked all the key issues that surrounded their business.

They talked about regulation; marketing; fee structures ... a whole range of things. As I got up to speak (angry I must admit) I noted that even though they are considered among the best, of a dozen points they came up with, the one they all forgot was the client. The client must come first, first, first.

So Ripoll's recommendation that the law be changed to put the clients' interest first and foremost in the financial planning process is exactly how it should be. Sadly, though, I know that too many in the investment industry still only think about themselves, and today will be kicking the rubbish-bin, thinking Ripoll is wrong and that the world is against them."
 

Frank,

Did you not make this personal when you told this forum that you spoke on the behalf of Storm Investors?

You put me in the position where I had to tell you and the ASF forum members who are reading this thread that you do not speak for me.

I do not have an axe to grind with you Frank. I just need you, and others who are following this thread, to realise that you do not speak for me. I don't think you speak for very many Storm Investors, but you've ignored the question I asked you about the numbers you 'represent'.

So, is it 10? 100? 500? 1,000?

How many people do you speak for? How many Storm Investors have you personally interacted with? How many members does your forum have?

Frank, I apologise for this, but I can't help myself. I'm "re-quoting" you here:

"One thing is for sure though. You are somehow connected with Storm. You wouldn't be this aggressive unless you were."

Are you being deliberately obtuse Frank?

Yes, I am "somehow" connected with Storm! I'm a former Storm Financial Client, victim or survivor, feel free to choose the label I should wear.

My "connection" with Storm has cost my family dearly, as it has many other families.

This is my only "connection" with Storm.

I will give it to you on one point, you're very adroit at blustering rather than answering direct questions.

Good Luck to you Frank, I wish you success in all you do.

MS
 

Igetit

No arguments from me here. Some neat modelling of the index should cover this as the funds the clients would have remained in were index funds. No issues with managers picking specific stocks or anything like that to worry about. If a client can prove they had the means to meet the call in the correct time period then they should be given the opportunity to be bought back to a position to reflect that and the subsequent movements since.

As an aside, there should be no argument around additional investing at the bottom of the market or anything silly like that as if people had the funds available they still could have done that anyway.

My assumptions are based on the fact the bulk (I won't generalise further if I can avoid it) of storm clients spent the first few months of the process getting turned upside down, shaken and harried into providing details of every last spot storm might be able to get equity from, bullied into setting an annual budget with no scope for additional or one off expenses and then told how lucky they were because based on all that they could actually borrow more than first expected.

For those who did hold back some monies and could have met the calls, I am all for them being bought back to the correct position. I don't see the banks fighting too hard on this point either.

Frank, think you might want to start a new forum if you go down the track of bashing the whole industry.
 
Some market decisions you can't fob off to your adviser
Marcus Padley
August 20, 2011

Kick tyres, not advisers.

MOST financial professionals accept that implicit in their fee is compensation for taking the responsibility for the poor performance of a client's investments without taking the credit for good performance.

It's a bit of a joke of course - how can a financial planner in Bendigo possibly be responsible for the performance of global markets, but still they take the blame and they do so to protect a client from taking the blame themselves, while generously bequeathing them the credit when it goes right.

It is an extremely important service which is highly valued by the client. It is like an insurance policy, a free option on looking clever, or at least not stupid, whenever you have to explain your investment performance to your spouse, dependents or dinner party guests.

Far better that your fund manager is a muppet, your stockbroker an idiot or your financial planner a crook, than you take responsibility for anything. The client is always right after all.

But, games aside, the truth is that there are certain decisions in finance for which the client is responsible. So, rather than hide behind your adviser, it would be far better if you took those decisions up front. They include:

THE DECISION TO INVEST IN THE FIRST PLACE It's a bit like this. If you wander on to a car lot looking at cars, the assumption is that you want to buy a car.

So, when you turn up in the offices of a financial professional there is an assumption that you want to buy something and, as most financial professionals only get paid when you do buy something, their job is to arrange for you to buy something. They are both salesman and agent. But it is your responsibility. If you wander into the yard and then get sold a car, what did you expect?

LEVERAGE Leverage to us is a product. We get a trail on it and, even if we don't, the more money you have the better it is for our fees and commissions.

It is in our interests to sell it to you and we would be foolish not to, not to present it as ''normal'' even when it's not. But it's not normal and it's not necessarily good for you. It is just an accelerant. If you lose you will lose more. If you win you will win more. And the undeniable reality is that it is only suitable in reliable bull markets. And, by the way, if you own shares outside of super and have a mortgage, you're leveraged. Being leveraged or not, it is your responsibility.

SELLING One of the hardest lessons from the global financial crisis was that nobody ever tells you to sell, because our job is to get you in, not let you out. The decision to sell is yours and, even when you decide to do it, you will have to be assertive because the likelihood is that we will resist you and we have a well developed bag of tricks to stop you. If you want to get out of the market you have to decide to do so. The decision to sell is your responsibility.

HAPPINESS Happiness is expectations met and the route to unhappiness is to have unrealistic expectations about what your investments are likely to achieve.

The main problem there comes from not understanding your benchmarks. In managed funds, it's the average return on all the invested asset classes less fees; and because of fees you have to expect to underperform. Because there are so many unrealistic expectations in this industry, often led on admittedly by unrealistic sales pitches, the number of people that get pleasantly surprised is tiny and the number of people disappointed is big. Your happiness is a function of realistic expectations. It is your responsibility to be happy.

The bottom line is the unfortunate fact of life that you cannot avoid responsibility for your own financial affairs. You have to be involved because, as any financial professional will tell you, ''if you don't care, no one will''.

Marcus Padley is a stockbroker with Patersons Securities and the author of stockmarket newsletter Marcus Today. For a free trial, go to marcustoday.com.au

His views do not necessarily reflect the views of Patersons.
 
GO BACK AND READ THE FIRST PAGE OF THIS THREAD AGAIN........VERY GOOD ADVICE FROM GG AND DUCKMAN......I ACTUALLY GOOGLED STORM BACK IN 08 AND FOUND THIS THREAD AND DUCKMANS POST
 
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