Storm Financial Group

[Smiley]

Daisy wrote: "Here's a thought for future users of Fps. Find out what the payout limit actually is and spread your money across different FPs so you never have more than the upper payout limit with anyone of them."

I would think that anyone using this forum would think twice about using a FP at all. My advice woud be to be in charge of your own affairs, read, invest in funds you can do directly like Vanguard, if you want to invest in shares. FPs won't recommend buying property, as they don't get a commission on such a purchase; though always a solid investment in the long run. After my experience with Storm, I would be loathe to pay a FP, even if I had the funds.

According to an expert in the financial area, who I know, as of 2008, all FPs had to have insurance.

 

[daisy]

With a bit more searching I found this:

http://www.asic.gov.au/asic/asic.ns...e+arrangements+for+AFS+licensees?openDocument

IR 07-52 ASIC releases guidance on compensation and insurance arrangements for AFS licensees

Tuesday 27 November 2007

It's not that hard to read and my understanding of it is that C. should have upgraded by mid 2008

There is still a question someone raised on another forum about whether you can make a claim on an FP insurance after the FP has gone into administration,
Which doesn't make sense to me.

I'll do a bit of digging around on the net and see if I can find an answer.

 

[daisy]

With a bit more searching I found this:

http://www.asic.gov.au/asic/asic.ns...e+arrangements+for+AFS+licensees?openDocument

IR 07-52 ASIC releases guidance on compensation and insurance arrangements for AFS licensees

Tuesday 27 November 2007

As regards the question of the FP going into administration all I can find is this passge on the same document. (2007)

Currently available insurance is unlikely to provide a source of funds where a licensee has become insolvent before the claim was brought. Ideally insurance policies would continue to cover the licensee after it has become insolvent or otherwise ceased business, but we understand this insurance cover is generally not available in the current market to the average licensee. We also recognise that insurers may exclude some areas of cover in currently available policies for risk management reasons.

ASIC will encourage the development of products that provide insurance cover in these areas by setting a higher standard that we will require licensees to meet after the implementation period

 

[daisy]

Daisy wrote: "Here's a thought for future users of Fps. Find out what the payout limit actually is and spread your money across different FPs so you never have more than the upper payout limit with anyone of them."

I would think that anyone using this forum would think twice about using a FP at all. My advice woud be to be in charge of your own affairs, read, invest in funds you can do directly like Vanguard, if you want to invest in shares. FPs won't recommend buying property, as they don't get a commission on such a purchase; though always a solid investment in the long run. After my experience with Storm, I would be loathe to pay a FP, even if I had the funds.

I agree Smiley but just reading some posts it seems some people just can't get this message through. It's talk about what the FP industry should be and not what it actually is.
From reading some other forums there are obviously some FPs who do operate with integrity but if you don't know anything you are in no position to make that judgement and are easy prey to the likes of C.

 

[carey ramm]

I wasnt planning on making many posts on these forums. However after reading some recent posts I felt compelled to do so.

For a forum that is supposed to be about suppport there is a lot of negativity expressed in some of these posts with a common thread that the storm client losses are the clients own doing as they should have been more educated and taken control of their advice more themselves. It is this type of response i would be expecting from Storm plants and bank trolls.

Come on people - is this really fair and constructive?

So when u go into the doctors u quickly whip up a 5 year medical degree, 2 years of residency and 5 years of practice experience to make u "more educated" so that u can then tell the doctor what they should or shouldnt be doing with your medical advice.

Same goes when u visit the lawyers or the accountants or the electricians, plumbers, mechanics and the list goes on.

So u want to be educated in the financial area - well whip up a quick maths heavy accounting or economics degree, a 2 year securities inistitute post degree diploma then grab 10 years experience split between the financial markets and property so u get a balanced view. Even then u would be a fool to solely take your own advice as it could hardly be objective and will be tainted with the emotions of dealing with your own money.

I am a successful businessman with businesses in most sectors of the economy including being the principal economist of one of the largest economic firms in Australia. I have two degrees in economics majoring in maths, undertaken securities institute courses and 20 years experience at all levels in both the finance and property sector. And even i go to a financial planner as i have learnt from experience that the emotions of second guessing yourself when making your own financial decisions means i cannot be as calculating and objective as when i am normally dealing with other people's money. My partners who are much more clever than I also do the same.

Now i am not saying dont get educated - but do read widely and canvass different opinions. See several financial planners about your financial needs and pick the one that best suits your circumstances.

Unfortunately this is what many Storm clients did and they chose Storm as i am sure they were told we have been round more than 20 years, we are independent as we have our own dealers license, we are one of the biggest, we run our own funds with some of the big names of the industry (macquarie, colonial, challenger), your investments are in indexed funds and not individual shares so this is low risk, and it would go on and on. Even client references were given and many people referred their friends to Storm and we know how powerful that can be. So for many clients they took the leap of faith and trusted the financial advice they were given and being relatively complex advice it made it much harder to question.

There has also been quite a few negative comments about the lawyers. In short the lawyers are doing this on a no-win no fee basis as quite frankly most storm clients are in such a bad position they cant afford a cup of coffee, much less think about running litigation against the banks. Now lawyers like Slater and Gordon do not take on these cases lightly especially when u r taking on someone like the banks and the magnitude of the costs involved. I have been dealing with them on the Storm issue from day 1 and we would not be where we are now if they did not think there were good chances of success. It isnt appropriate to go into detail on the legal strategy here.

I would also point out that Trolls are going through these forums and i would expect them to be encouraging Storm clients to take their losses on the chin and skulk away into the darkness - it is what we had to deal with in Oct, Nov and Dec with Storm when they would spam the boards and letters to editor of papers spruiking everything will be ok or dont blame Storm etc. The banks will be using PR and crisis management firms just like Storm did. Even private investigators......

I would also point out that the media are also very important in this fight and we need Storm clients to tell their story. Only a few brave ones have done that to date. Yes it does take courage but those that have been telling their story in the papers are doing so to make sure this Storm fiasco doesnt happen again and they may stop others from making the mistakes they have made. The media is a great tool for holding banks, Storm and regulators accountable through the impact on their reputation. If u want to tell your story to the media (either with or without disclosing your identity) then please email me at carey@aecgroupltd.com

I would particularly like to thank those Storm clients who stepped forward to do the interviews with Paul Barry and 4 Corners which will go to air on Feb 9. It is this level of investigative jounalism that will help Storm clients get justice. I am sure Allan Bond can agree with that.

If u r a Storm client please read my earlier post on what documents u should be collecting and who u need to contact to join the legal claim.

Please attend the Storm Action group events - for those in Townsville it is on wed 28 jan at 6pm at Ryan College.

Best wishes

Carey Ramm
Principal Economist
AEC Group Ltd

 

[Solly]

Sunday Mail now reports that Slater and Gordon are filing a lawsuit against Storm executives and others. Let the games begin.........

 

[daisy]

I would also point out that Trolls are going through these forums and i would expect them to be encouraging Storm clients to take their losses on the chin and skulk away into the darkness - it is what we had to deal with in Oct, Nov and Dec with Storm when they would spam the boards and letters to editor of papers spruiking everything will be ok or dont blame Storm etc. The banks will be using PR and crisis management firms just like Storm did. Even private investigators......

Please attend the Storm Action group events - for those in Townsville it is on wed 28 jan at 6pm at Ryan College.

Best wishes

Carey Ramm
Principal Economist
AEC Group Ltd

There's that word troll again. I don't know about anybody else but for me it induced a level of paranoia into what I assumed was a free and open forum.
Once I got it into perspective I realised that there are many people who partake in this forum who have one agenda or another and I read all posts keeping that in mind.

 

[Macquack]

As regards the question of the FP going into administration all I can find is this passge on the same document. (2007)

Currently available insurance is unlikely to provide a source of funds where a licensee has become insolvent before the claim was brought.

Another example of "donations" that a given to insurance companies. Premiums are paid for "cover" that does not exist.

Ideally insurance policies would continue to cover the licensee after it has become insolvent or otherwise ceased business, but we understand this insurance cover is generally not available in the current market to the average licensee.

Ideally?

We also recognise that insurers may exclude some areas of cover in currently available policies for risk management reasons.

"may exclude some areas of cover " -translates to- "read the small print and see that you are not covered".
"risk management reasons"- translates to- "we try to avoid payouts at all costs, thats how we make money".

If the insurance companies are going to wiggle their way out of paying, they should at least refund the "premiums" paid by Storm and give them back to the receiver.

 

[Solly]

I totally endorse Cary Ramm's position in his post above. I always seek the advice and opinions of those much smarter and more qualified than me before proceeding in any venture. For me a DYI approach has always had a reduced result or worse, plus it used more of my precious time.

 

[Glen48]

Any one investing in any thing needs to realise that the money for their goods to appreciate has to come from another avenue yes some will go up or down a bit more than others but in the long run it has to stop appreciating.
House prices can't keep rising for years if they did wages would have to too keep pace, therefore if some one is setting the World on fire there has to be a catch.

 

[DanielleR]

For a forum that is supposed to be about suppport there is a lot of negativity expressed in some of these posts with a common thread that the storm client losses are the clients own doing as they should have been more educated and taken control of their advice more themselves. It is this type of response i would be expecting from Storm plants and bank trolls.

Come on people - is this really fair and constructive?

Well to start, this is a stock forum. The majority of people on here have higher understanding of their financial needs/situation than the standard Joe. To call people on these forums trolls just because they are negative towards people who were foolish enough to go with Storm is just plain wrong.

So when u go into the doctors u quickly whip up a 5 year medical degree, 2 years of residency and 5 years of practice experience to make u "more educated" so that u can then tell the doctor what they should or shouldnt be doing with your medical advice.

Same goes when u visit the lawyers or the accountants or the electricians, plumbers, mechanics and the list goes on.

Now this is what I consider trolling... You don't need 15+ years to have at least some understanding of your financial circumstances. Do you need this type of education to think to yourself, "Gee what happens if the funds/shares go down?"

A friend of mine (a financial planner) said one of her potential clients came in with a financial plan from Storm. It had the client geard to nearly 100%! She advised the potential client that they do not gear people up that much because it is not responsible. That client went to Storm even after the advice. Should we feel sorry for that person?

 

[daisy]

I wasnt planning on making many posts on these forums. However after reading some recent posts I felt compelled to do so.

For a forum that is supposed to be about suppport there is a lot of negativity expressed in some of these posts with a common thread that the storm client losses are the clients own doing as they should have been more educated and taken control of their advice more themselves. It is this type of response i would be expecting from Storm plants and bank trolls.


I would also point out that Trolls are going through these forums and i would expect them to be encouraging Storm clients to take their losses on the chin and skulk away into the darkness - it is what we had to deal with in Oct, Nov and Dec with Storm when they would spam the boards and letters to editor of papers spruiking everything will be ok or dont blame Storm etc. The banks will be using PR and crisis management firms just like Storm did. Even private investigators......



Best wishes

Carey Ramm
Principal Economist
AEC Group Ltd

Sorry everybody I got the quote tags wrong. So I'm reposting.
When the word troll was first introduced into this forum for me at least it also introduced a level of suspicion and paranoia.
But when I got it into perspective I realised that there are many people who have many different agendas that make posts. I bear that in mind when I'm reading all posts.....

 

[Julia]

For a forum that is supposed to be about suppport there is a lot of negativity expressed in some of these posts with a common thread that the storm client losses are the clients own doing as they should have been more educated and taken control of their advice more themselves. It is this type of response i would be expecting from Storm plants and bank trolls.

Come on people - is this really fair and constructive?

I'm not sure you're being entirely fair yourself here. I think few people here have criticised anyone for seeing a financial planner. What has astonished many of us, though, is thatso many Storm clients agreed to the amount of leverage that has apparently been used over their homes.

I also think it's rather unreasonable of you to suggest that people are not in a position to make sound financial decisions without acquiring all the qualifications you just happen to mention you have. If you choose to use a financial planner then of course we respect that choice. But if some of us have been able to educate ourselves to a level where we are consistently profitable, whether from shares, property or a combination of both, then I don't think it's up to you to tell us we don't know what we're doing.

The analogies with, e.g. a medical degree are spurious. The specialised training and experience a doctor has cannot be compared with learning how the markets operate. Any reasonably intelligent person with an interest in taking responsibility for their own outcomes can, with time and practice, acquire the capacity to manage their own financial affairs with assistance as required from an accountant.

 

[daisy]

As regards the question of the FP going into administration all I can find is this passge on the same document. (2007)

Currently available insurance is unlikely to provide a source of funds where a licensee has become insolvent before the claim was brought. Ideally insurance policies would continue to cover the licensee after it has become insolvent or otherwise ceased business, but we understand this insurance cover is generally not available in the current market to the average licensee. We also recognise that insurers may exclude some areas of cover in currently available policies for risk management reasons.

ASIC will encourage the development of products that provide insurance cover in these areas by setting a higher standard that we will require licensees to meet after the implementation period

I can see that I'm going to have to get a little more savvy about how I post.

The clauses that Macquack has highlighted and commented on was the situation when ASIC put this document together in 2007.
The clause that I bolded was what they were saying they wanted to see happen with the implementation of the new policy which for C. should have been mid 2008.
So as I read it basically what they are saying is that while in 2007 insurance wouldn't cover claims post insolvency they wanted to see that change with the implementation of their new policy roll out.
I just can't find out if it happened or not.

 

[sails]

...For a forum that is supposed to be about suppport there is a lot of negativity expressed in some of these posts with a common thread that the storm client losses are the clients own doing as they should have been more educated and taken control of their advice more themselves. It is this type of response i would be expecting from Storm plants and bank trolls....

I think public forums such as ASF is more about sharing viewpoints rather than being solely a support forum. I don't believe it's about being right or wrong - it's about the freedom to express one's views and knowing the possibility that someone may well post an opposing view. IMO, that is simply part of participating in a forum, and especially so with a large, diverse membership. There have been some very lively debates in quite a few threads on ASF.

Personally, I feel very much for those caught up in this mess. It is distressing to read of their difficulties. If I hadn’t become a little educated in the stock market, there is a good chance that hubby and I could have been in a similar position. A FP attempted to “bait” us with a similar proposal couple of months before the markets made its high point.

IMO, slick marketing becomes very compelling especially when it’s something you would really like or need. Especially so when you believe you are in the hands of experts. Convincing people to put their hard earned homes on the line and then glibly brushing off their concerns (as outlined in so many posts on this thread) brings into question the level of potentially highly manipulative marketing techniques used on some of their clients.

 

[Glue]

Thanks Carey
your post was appreciated, when selecting a fp it is hard to sort the wheat from the chaff, but you gave me heart.

cheers
Glue

 

[stung]

My Storm story post is on p 31.

Since I lost our life savings I feel totally stripped of any self worth. I can hardly look my young son in the eye for the guilt about how his life will now change because of my huge debt.

No post whether it be about utter greed, sheer stupidity, or of my own making, can make me feel any worse than I already do. But some posts like yours Carey make me feel a tad better. So thanks.

 

[daisy]

In yesterday's Townsville bulletin there were 2 articles about storm.

One was about the Consumer action group meeting.

The other one was about a feng shui expert who says that just by looking at photos of storms headquarters building her feeling was that in all probability it had bad feng shui and this would have contributed to the collapse of the company.

 

[bunyip]

I wasnt planning on making many posts on these forums. However after reading some recent posts I felt compelled to do so.

For a forum that is supposed to be about suppport there is a lot of negativity expressed in some of these posts with a common thread that the storm client losses are the clients own doing as they should have been more educated and taken control of their advice more themselves. It is this type of response i would be expecting from Storm plants and bank trolls.

Come on people - is this really fair and constructive?

So u want to be educated in the financial area - well whip up a quick maths heavy accounting or economics degree, a 2 year securities inistitute post degree diploma then grab 10 years experience split between the financial markets and property so u get a balanced view. Even then u would be a fool to solely take your own advice as it could hardly be objective and will be tainted with the emotions of dealing with your own money.



Carey Ramm
Principal Economist
AEC Group Ltd

Well I must be a fool then Carey, because I've got myself financially savvy and have been managing my own investments for years without relying on the advice of investment advisers/financial planners. I know several wealthy people who can make the same claim. And we didn't do it by spending years studying for university degrees in mathematics, accounting, economics or anything else. I've made money all through this financial meltdown, and in the bull run that preceded it, as have quite a few other self-educated people of my acquaintance. Bull market, bear market, flat market....there are money-making opportunities under all market conditions for those who know how to exploit them. At the very least, there are various ways to avoid losing heaps of money in tough market times.
Have any managed funds or financial planners made money during this market slump? If not, why not.....they're supposed to be the experts aren't they? They have pieces of paper to prove it, don't they?
Did any of them have the sense to convert to cash when the financial skyline was looking increasingly dark and stormy?
I'd suggest that those who did would be very much in the minority.

My sister-in-law borrowed two hundred thousand dollars for stock market investment via a financial planner. Initially she did very well....a 100% gain. But then the market showed signs of running into trouble. She was unaware of this until I pointed it out to her....she had handed over the reins to a 'financial expert' to manage her investments, and hadn't bothered keeping herself in touch with what was happening.
I suggested she reduce her exposure by 50%. After seeking the advice of her financial planner, she decided to hang on. A bit further down the track, the market showed clear sings of having entered a bearish phase. I told her the party was over and it was time to head for the exit gate. Her adviser told her to hang on. She did.
Her gains have evaporated into thin air, and may even turn into serious loss if she continues to hold out.
Now she tells me "I wished I'd listened to you".

What's interesting, Carey, is that even though I didn't go to uni and I have no degrees or professional qualifications whatsoever, the advice I gave her was far more useful than the advice she got from her financial planner.

What I have instead of professional qualifications is, in my opinion, far more valuable....
* a sound knowledge of investment gained through concerted effort in self-educating myself
* a good deal of common sense
* the ability and willingness to adapt to changing situations

I'm not in the least impressed by professional qualifications, no matter how impressive they're made to sound by those who wish to spruik about them.
Professional qualifications are a poor substitute for common sense.....I'll back common sense any day.

Some of us, myself included, have suggested that Storm clients bear some of the responsibility for the levels of gearing they took on, the inaction they displayed when the markets showed very clear signs of caving in and every media outlet was telling us about it every day, and their indecisiveness in letting Storm talk them out of taking defensive action.
We were quite reasonable in expressing these views, and I believe that the honest Storm clients probably agree with us.

I find it comical, naive and pathetic that you've attempted to hang the label of 'Storm plants and bank trolls' on anyone who suggested that Storm clients should have kept their finger on the pulse.

So let me set the record straight for you.....I'm not one of those 'Storm plants and bank trolls' you mentioned. I don't for one moment believe that the banks and Storm can be absolved of all responsibility for the Storm debacle. Believe me, I'm no fan of either banks or financial planners/advisers.
But that doesn't change my view that Storm clients must also shoulder some of the responsibility for what happened. Nobody passed a ruling forbidding them from having any input into the management of their investments.
Nobody held a gun to their heads and forced them into anything.

 

[pacestick]

I agree with you bunyip you can not beat experience as a teacher. Even though I do hold degree in marketing and human resource management which included some economics and accountancy It is not the degree that allowed me to claim 2008 as my best year in the market but instead it was doing hours and hours of research and pu;;ing out half my net profit each time I sold so that I am in a position to average down when I believe the bottom has been reached not yet of corse