Storm Financial Group

[Harleyquin]

I'm aware, as I'm sure most are, that storm was not the only company to cause it's clients grief. I fail to see what this has to do with the what happened to either SF or other financial companies clients.

The problem is not that clients should have done their own research or any other cop-out excuse. The basic problem is that these companies were registered by the government to operate as a financial advisory company. Storm were approved by ASIC so I'm assuming for the sake of this debate that the other companies were too.

All registered advisors and/or financial organizations selling their expertise have certain laws/ rules they have to abide by. They broke their own rules. Why should anyone of us 'just accept that some crooks exist in this industry to prey on their clients' and that's OK. The point is this is not OK and never should be OK.

Some of you on this forum are basically saying 'get over it and move on'. Rubbish. If you are prepared to sit back, do nothing and just accept this lousy state of affairs then that's your problem. I'm not.

The people who caused their clients so much grief are criminals. The clients DID NOTHING WRONG.

 

[Harleyquin]

Bunyip, Frank was NOT the gambler. He did nothing wrong.

 

[Harleyquin]

Bunyip you may have been able to google something pre storm.

A lot of us didn't own a computer back then. A lot of people still don't own a computer. A lot of people have no idea how to google anything.

Don't assume that because you were lucky enough to afford a computer that this was the case for everyone. They were three thousand dollars back then. Just to buy a laptop you are up for a thousand dollars. That's a lot of money when you don't have it to part with!!!

Not everyone lives close to the facilities needed to do research or where to start researching. too many people have no idea where to start this so called research that you are so familiar with

You are all going to throw your hat into the ring and disagree with me. Why? Because those of you who will do that have the benefit of hindsight, some of you hadn't even heard of storm until it collapsed...and now you are all experts on storm, storm clients and why it happened etc etc etc.

The first person I would have gone to, to seek advice, as part of my 'research' would have been a financial planner!!!

 

[DocK]

I read a quote in my sons' school newsletter that I thought particularly apt for those ex-storm clients currently involved in legal actions:

Being defeated is often a temporary condition. Giving up is what makes it permanent.

Marilyn vos Savant.

 

[bunyip]

Bunyip, Frank was NOT the gambler. He did nothing wrong.

Committing hundreds of thousands or millions of dollars to an investment without first doing some research – that’s gambling.

Trusting the word of salesmen and accepting what they say at face value – that’s gambling.

Putting all you eggs in one basket, particularly the always risky stock market basket – that’s gambling.

Investing in a strategy that can succeed only if the market keeps going up – that’s gambling.

Mortgaging your home to borrow substantial funds for stock market investment when you’re at or near retirement age – that’s gambling.

It’s clear that some Stormers didn’t realise the gamble they were taking. But that doesn’t alter the fact that Storm's strategy was little more than a huge gamble that was doomed to failure once the market turned bearish.
The responsibility of every investor is to do his or her homework before committing funds to any investment. This holds true even if you get professional investment advice.
The great majority of people who approached Storm did their homework, saw the risks in the Storm model, and walked away.
Those who didn't do their homework got caught. Sad but true.

 

[Frank Ainslie]

Storm Financial and the Banks - The truth, the whole truth, and nothing but the truth!

I created the SOB Group because I wanted to give people who had suffered at the hands of Storm and the Banks involved with that firm the opportunity to voice their opinions without fear or favour. However, any closed Group has its limitations because those in it tend to be somewhat insular. Hence, my reasoning for joining the ASF.

I thought that by becoming a member of this forum it would give me an opportunity to educate the public as to what really occurred rather than what they can garner from the media. However, it appears that this forum is inhabited by certain individuals whose sole object is to denigrate the victims rather than focus on the wrongdoers; namely Storm and the Banks. Whilst it makes for interesting reading at times, it does little to further the truth, and, more importantly, it does nothing in the way of encouraging people that were burnt by this financial disaster to have their say. Therefore, I have decided to create another Group of my own which I will call, “Storm Financial and the Banks” - ‘The truth, the whole truth, and nothing but the truth!’

Whilst it will be a public site, I will control the content so that everyone will be able to express themselves without fear of being ridiculed by other people that have their own agendas. Having spent three years in limbo, the last thing any of us 'Stormies' want is to be continually told that we were gambling with our money. They, Storm and the Banks, certainly did! WE DIDN’T!

I’ll post this Group address when I have it up and running! Anyone on this forum that is genuinely interested in what occurred or any 'Stormies' that would like to air their views in a friendly environment are welcome to post their comments there!

 

[maccka]

I read a quote in my sons' school newsletter that I thought particularly apt for those ex-storm clients currently involved in legal actions:

Marilyn vos Savant.

There is also...

"The tough times don't last; the tough people do."
"Never, never, never, never give up!"
“Failure is not falling down but refusing to get up.”
“If you get up one more time than you fall you will make it through.”

cheers
Maccka

 

[bunyip]

I'm aware, as I'm sure most are, that storm was not the only company to cause it's clients grief. I fail to see what this has to do with the what happened to either SF or other financial companies clients.

The problem is not that clients should have done their own research or any other cop-out excuse. The basic problem is that these companies were registered by the government to operate as a financial advisory company. Storm were approved by ASIC so I'm assuming for the sake of this debate that the other companies were too.

All registered advisors and/or financial organizations selling their expertise have certain laws/ rules they have to abide by. They broke their own rules. Why should anyone of us 'just accept that some crooks exist in this industry to prey on their clients' and that's OK. The point is this is not OK and never should be OK.

Some of you on this forum are basically saying 'get over it and move on'. Rubbish. If you are prepared to sit back, do nothing and just accept this lousy state of affairs then that's your problem. I'm not.

The people who caused their clients so much grief are criminals. The clients DID NOTHING WRONG.

I'm not saying that Storm clients did anything wrong as in illegal or immoral or unethical.
I'm saying they made some mistakes that could have been avoided if they'd done a small amount of research and independent thinking.
This in no 'cop-out excuse', Harleyquin, it's just a simple fact.
If they were unwilling or unable to do some research for whatever reason, then they should have stayed away from investment.
If you invest money without looking into the investment first, you leave yourself wide open to cop a big kick in the belly.
That's just the cold hard reality of the investment world, unfortunately.

Nor am I saying 'get over it and move on'. On the contrary, I've said all along that you should take legal action against anyone who you think was involved in illegal behaviour that contributed to your losses.

 

[SJG1974]

Having spent three years in limbo, the last thing any of us 'Stormies' want is to be continually told that we were gambling with our money. They, Storm and the Banks, certainly did! WE DIDN’T!

Come off it Frank.

Do you seriously believe that borrowing against your home even though you ADMITTED it served no benefit was not a gamble?

Do you seriously believe that going ahead with the strategy even in the absence of the written statements by Stuart Drummond which you repeatedly asked for was not a gamble?

You repeatedly went against your own better judgment and proceeded with the Storm strategy. Do you believe that going against your own better judgment is not gambling?

Do you think that throwing all of your hard earned life savings into such a high risk strategy, despite all of these red flags popping up which you were acutely aware of, is not gambling?

You double geared when you had absolutely no need to Frank. You spent years in business, you knew the risks of debt, yet you paid those risks not one ounce of respect, and it burnt you.

It appears many Storm clients had absolutely no idea what they were getting into. You, on the other hand, actually had some sense of the risks and you went ahead anyway, despite your doubts. The lure of whatever it was they sold you was just too much to ignore, even though that voice in your head warned you of the risks.

You gambled and you lost Frank. If you hadn't taken those gambles, you wouldn't be devoting your life to making someone pay for your losses. That is the unfortunate truth.

But no, you would have everyone believe that it was ALL the banks' and Storm's fault that you lost your life savings. Of course it was Frank, of course it was.

And I and others who don't swallow your "Its all the bank's fault" line of reasoning hook line and sinker are the ones with an agenda?

 

[bunyip]

Whilst it will be a public site, I will control the content so that everyone will be able to express themselves without fear of being ridiculed by other people that have their own agendas.

You wouldn't be a Greens voter by any chance, would you Frank?
Would Bob Brown be one of your heros perhaps?

Bob wants to pass laws to control the press so they can’t direct criticism towards him or his pathetic policies.

 

[bunyip]

The first person I would have gone to, to seek advice, as part of my 'research' would have been a financial planner!!!

Sounds reasonable to me.

And the first person you'd go to if you wanted to buy a house would be a licensed real estate agent.

And the first person you'd go to to buy a car would be a licensed motor dealer.

But would you believe the real estate salesman if he told you the house was priced well below market value, was in top condition and was in an area that could expect rapid price appreciation, and there were no new highways planned to come right past the door?

Or would you do some research by employing a solicitor to check for any easements or highway plans or anything else that could affect the property?
Would you pay a builder a couple of hundred dollars to inspect the building and give you a report on its condition?
Would you talk to the local council in an effort to uncover anything that could have a negative impact of the property?
Would you consult a firm of valuers, as well as several other real estate agents, in an effort to find out if the property was fairly priced?
I would - I'd dig and dig and dig in an effort to uncover every piece of information relevant to the property.

How about the motor dealer? Would you accept his offer for your trade because he assured you he was offering top dollar?
Would you buy his car because he assured you that his make and model was head and shoulders about every other car on the market?
Or would you do some research by looking into the value of your trade, and perhaps consulting one of the motoring bodies for a report on various makes of cars?
Maybe talking to a few mechanics would be a good move as well, to get some idea of which makes of cars they do most repairs on.

To cut a long story short, you'd conduct thorough research before committing a few hundred thousand dollars to a house investment, or thirty or forty grand to a car purchase.

So before committing much larger sums of money to a stock market investment, don’t you think it would be prudent to do a bit of research rather than just believing the investment adviser who tells you what a great investment strategy he has for you?

 

[bunyip]

There is also...

"The tough times don't last; the tough people do."
"Never, never, never, never give up!"
“Failure is not falling down but refusing to get up.”
“If you get up one more time than you fall you will make it through.”

cheers
Maccka

Wise and inspirational words, Macca.
And they apply to successful investors as much as they apply to Storm casualties.
I'll hazard a guess that every successful investor has his/her share of the ups and downs of investing. Not everything that's touched turns to gold, not even for successful inventors.
Many of us on here, myself included, have known hard times. Many of us have made decisions that sometimes didn't turn out too well.
You get over it, you learn from your mistakes, you move on and try to do things better next time.
Learning from your mistakes is the most important one. You learn nothing by adopting the attitude that it's all someone else's fault.
Sometimes part of it is someone else's fault. But always some of the fault is your own when your investment decision turns out badly.

Facing up to this reality is important for Stormers if they ever want closure on this.
They have little if any chance of recovering their entire losses.
If they keep blaming everyone else, they'll be bitter and sour for the rest of their lives over what they lost.
They'll be much happier people if they can accept their share of the responsibility for the decisions they made and the actions they took.
I speak from personal experience here.

 

[Solly]

<snip>......................

Facing up to this reality is important for Stormers if they ever want closure on this.
They have little if any chance of recovering their entire losses.
If they keep blaming everyone else, they'll be bitter and sour for the rest of their lives over what they lost.
They'll be much happier people if they can accept their share of the responsibility for the decisions they made and the actions they took.
I speak from personal experience here.

bunyip,

Are you able to share with us what this 'personal experience' was ? Have you suffered that same magnitude of personal loss and circumstance as the Stormers and have you since recovered ?

S

 

[pegasus]

Sounds reasonable to me.

And the first person you'd go to if you wanted to buy a house would be a licensed real estate agent.

And the first person you'd go to to buy a car would be a licensed motor dealer.

But would you believe the real estate salesman if he told you the house was priced well below market value, was in top condition and was in an area that could expect rapid price appreciation, and there were no new highways planned to come right past the door?

Or would you do some research by employing a solicitor to check for any easements or highway plans or anything else that could affect the property?
Would you pay a builder a couple of hundred dollars to inspect the building and give you a report on its condition?
Would you talk to the local council in an effort to uncover anything that could have a negative impact of the property?
Would you consult a firm of valuers, as well as several other real estate agents, in an effort to find out if the property was fairly priced?
I would - I'd dig and dig and dig in an effort to uncover every piece of information relevant to the property.

How about the motor dealer? Would you accept his offer for your trade because he assured you he was offering top dollar?
Would you buy his car because he assured you that his make and model was head and shoulders about every other car on the market?
Or would you do some research by looking into the value of your trade, and perhaps consulting one of the motoring bodies for a report on various makes of cars?
Maybe talking to a few mechanics would be a good move as well, to get some idea of which makes of cars they do most repairs on.

To cut a long story short, you'd conduct thorough research before committing a few hundred thousand dollars to a house investment, or thirty or forty grand to a car purchase.

So before committing much larger sums of money to a stock market investment, don’t you think it would be prudent to do a bit of research rather than just believing the investment adviser who tells you what a great investment strategy he has for you?

get over yourself mate!

 

[explosiveanthony]

I like to sit on the fence and consider both sides of the argument before passing judgement. I hear there is a documentary coming out on the whole storm financial.

The director/cameraman/(someone doing the docco) of the documentary made an interesting comment that he thought storm victim's were idiots until he started filming... Then he saw how normal everyday people got caught up in all the hype.

So I suppose, put yourself in the victim's shoes and consider how bad it would be to lose everything. Having said that - Everyone who took part in the process from the banks, to the product floggers right down to the storm investors all played their part.

Remember the age old principles "5 Laws of Gold"

1. Gold cometh gladly and in increasing quantity to any man who will put by not less than one-tenth of his earning to create an estate for his future and that of his family
2. Gold laboreth diligently and contentedly for the wise owner who finds for it profitable employment, multiply even as the flocks of the field
3. Gold clingeth to the protection of the cautious owner who invests it under the advice of men wise in its handling
4. Gold slippeth away from the man who invest it in businesses or purposes with which he is not familiar or which are not approved by those skilled in its keep
5. Gold flees the man who would force it to impossible earning or who followeth the alluring advice of tricksters and schemers or who trusts it to his own inexperience and romantic desires in investment

That's my 2c worth

 

[Harleyquin]

I disagree with you Bunyip and I repeat Frank or any storm client were never gamblers.

A licensed financial advisor told us that this type of investment strategy was perfectly safe and gave a perfectly reasonable explanation why. We trusted and believed.

If you care to read your local newspaper there are often articles in their telling you how important it is to seek advice from a licensed financial planner.

Show me anywhere where it says 'don't trust those mongrels with your money they'll only rip you off' or 'go to them but don't trust what they say...do your own research'

 

[Harleyquin]

SJG you need to direct those questions to the financial planner who Frank went to. Frank was the client, and he like so many others, were told that this was a safe genuine investment strategy...by people who have already done the big R word ie RESEARCH. ASIC thought this advice was OK. The FPA thought this advice was OK. The entire Aussie banking industry thought this advice was OK. What's your problem!!!! She asked..very tongue-in-cheek???!!!???

DoK and Maccka love all of those quotes.

Oh and DoK don't take my use of the term 'wish' tii literally...I don't.

 

[bunyip]

I disagree with you Bunyip and I repeat Frank or any storm client were never gamblers.

A licensed financial advisor told us that this type of investment strategy was perfectly safe and gave a perfectly reasonable explanation why. We trusted and believed.

If you care to read your local newspaper there are often articles in their telling you how important it is to seek advice from a licensed financial planner.

Show me anywhere where it says 'don't trust those mongrels with your money they'll only rip you off' or 'go to them but don't trust what they say...do your own research'

Harleyquin

A licensed investment advisor told you that it was a ‘perfectly safe’ investment strategy to mortgage your home and borrow big money to sink into a highly speculative and risky investment such as the stock market.
And you believed him.
That’s like believing a licensed real estate agent who tells you it’s perfectly safe to buy a house on a flood plain beside a creek that’s prone to flash flooding.
It’s like believing a licensed motor dealer who tells you the car he’s trying to sell you is so good that it’s perfectly safe to be driven at 200 kph.

Sometimes in life we have to think for ourselves and use a bit of common sense. If you’d done that with Storm then you wouldn’t have been burnt.
Sorry to be blunt, but that’s the reality.

Of course you’re not going to see any ads that tell you not to trust salesmen, they might rip you off, do your own research. You don’t see it in car ads or house ads or any other kind of ads – it’s not surprising that you don’t see it in ads about investment advice either.

You seem absolutely determined to try and justify your actions in relation to Storm. You’re absolutely determined not to accept the reality that it was a big gamble to mortgage your home and commit huge borrowings to a highly risky and speculative investment without researching the strategy first.

No problem – I’m quite happy for you to persist with those beliefs if that’s what you choose to do. It’s all the same to me.

 

[doobsy]

SJG you need to direct those questions to the financial planner who Frank went to. Frank was the client, and he like so many others, were told that this was a safe genuine investment strategy...by people who have already done the big R word ie RESEARCH. ASIC thought this advice was OK. The FPA thought this advice was OK. The entire Aussie banking industry thought this advice was OK. What's your problem!!!! She asked..very tongue-in-cheek???!!!???

DoK and Maccka love all of those quotes.

Oh and DoK don't take my use of the term 'wish' tii literally...I don't.

HQ - Is it just me or does 90% of what everyone says end up returning to BAD ADVICE. Is that the Stormies fault, no, could they have looked into things further, yes with a but, the but being should they need to.

I do however want to clarify a couple of points. The Storm strategy was legal. It was a legitimate investment strategy. SO no ASIC did not have a problem with it, no FPA did not have a problem with it, no the banks did not have a problem with it (even though I am still lost about how Stormies some how make a link that their 25 year old mortgage person at a bank should be able to tell them to or not to proceed with advice given by a firm with 20 years of industry experience)

Where does that leave us? It leaves us with a high risk strategy sold as low risk. It leaves us with "commoditised" advice that was given to everyone. It leaves us with advisers who did know the risks downplaying them then not acting to protect their clients when S hit fan. It leaves us with clients thinking their advisers were acting in their best interests.

Lets get back to some level of reality. The thread is Storm and it is Storm that is still very much the bulk of the reason clients are wiped out.

 

[bunyip]

I like to sit on the fence and consider both sides of the argument before passing judgement. I hear there is a documentary coming out on the whole storm financial.

The director/cameraman/(someone doing the docco) of the documentary made an interesting comment that he thought storm victim's were idiots until he started filming... Then he saw how normal everyday people got caught up in all the hype.

So I suppose, put yourself in the victim's shoes and consider how bad it would be to lose everything. Having said that - Everyone who took part in the process from the banks, to the product floggers right down to the storm investors all played their part.

Remember the age old principles "5 Laws of Gold"

1. Gold cometh gladly and in increasing quantity to any man who will put by not less than one-tenth of his earning to create an estate for his future and that of his family
2. Gold laboreth diligently and contentedly for the wise owner who finds for it profitable employment, multiply even as the flocks of the field
3. Gold clingeth to the protection of the cautious owner who invests it under the advice of men wise in its handling
4. Gold slippeth away from the man who invest it in businesses or purposes with which he is not familiar or which are not approved by those skilled in its keep
5. Gold flees the man who would force it to impossible earning or who followeth the alluring advice of tricksters and schemers or who trusts it to his own inexperience and romantic desires in investment

That's my 2c worth

I see you've been reading 'The Richest Man In Babylon'

An excellent little book - I got each of my kids to read it when they were teenagers.
That book and others like it would be invaluable additions to the school curriculum - they'd be far more beneficial than Shakespeare and some of the other boring rubbish I had to study at school.

I recommend that book to everyone on this forum.