Storm Financial Group

[Trevor_S]

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

This is not a support group, see Lifeline for that, this is a forum to mostly talk about Stocks and Investment on the ASX.

I disagree with most of what you have said.. just one example

Would you feel sympathy for someone in this day and age that took up smoking, smoked all their life and then contracted lung cancer ? Sure you would feel compassion and empathy for their plight, no one wants anyone to suffer such a terrible disease but at the end of the day, who was to blame ?

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.

1. Doctors charge an hourly rate
2. Most people would have a general understanding of health, well being & hygiene. eg wash your hands after the toilet, brush your teeth, what foods are good for you, don't smoke etc which is akin to the sort of level of financial information that most people should understand. We're not talking complex financials eg with how to use financial synthetics, CFD's, warrants and option trading, commodities futures, currency hedging etc.

How they invested appears quite simple, these guys appeared to have invested in an index fund (okay so far but I would be more inclined towards a decent LIC ) and leveraged into that index fund inappropriately. For this "investment advice" they were charged extortionate fees to do that (their choice) (similar advice, sans leveraging, to which I gave to my younger sister for nothing, ie pay your house off as fast as you can, then 1. save the excess cash and when you have saved a reasonable amount, 2. purchase shares in a LIC (eg ARG), using value averaging and repeat 1. & 2. for 20 years, 5 years short of retirement, reassess.

To my mind they need to accept some of the responsibility. I do acknowledge there appears to be untoward (which is despicable) and inappropriate advice to some(?) clients but isn't it something like 1,200 out of 14,000 clients in true difficulty and 300 or so are looking at true financial disaster and ? the others just suffered from the vagaries of a market downturn like the rest of the World.

As to shills from Banks and Strom, I doubt that very much from reading these threads.

 

[Garpal Gumnut]

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

Glue mate, be careful that you do not mistake finance and friendship. Anyone you deal with on a financial basis should not "give you heart". That is an emotional response. If you were a Storm victim, that is precisely the mindset that got you into strife in the first place.

This forum will be interrupted by people with agendas, financial planners and their advisers with a litany of qualifications and experience. They will cajole you with sympathy and then try to win you over to their firm. Be careful.

Kerry Packer never entered or left a negotiation "feeling good" about the other bloke.

I enclose a post of mine from a few weeks ago on this topic.

Best of luck mate.

gg

And into the arms of another Financial Planner peddling the same old line, cheap american positivism, you betcha, YOU can get out of this folx.

These unfortunate people need to

Sue those with the biggest pockets.
Crucify ASIC
Crucify the Financial Planners Association which from the Fin Review had a Director of Storm on the Review Panel until a few weeks ago.
Get your State and Federal members of Parliament to do the job they were elected to do.

And Never, Ever, Trust your money to a Financial Planner.

gg

 

[Glen48]

I see The Ex Mrs. Bulivant is mixed up with Storm She had the local pub here purchased it for 4M and sold if for something like 11M, just how much money does one need???
The paper thinks she might have lost $50M

 

[daisy]

Bye everyone.
I came to find out how this happened. Found out. Got a bit obsessed. Tried to help. But can only do so much.
I will be watching the stoush with the banks with great interest.
Good Luck to all of you.
Daisy

 

[Anastasia]

I have been reading this forum for awhile often wanting to respond to posts but never quite having the courage to sit down and "nut" it out. But after reading Carey Ramms post, just maybe I have the courage to do this.

My husband and I were Storm clients and have truly had our future "re-arranged" to that which we expected. And what was this? A self funded retirement with yearly funds of around $50K...not a greedy income in our belief.

Yes we are guilty of not doing our research and we have kicked ourselves many times. But circumstances have changed many times over the 12 odd years we had been with Storm. Firstly our advisers had changed three times. Then we changed funds, margin lenders, banks, etc several times, took steps, and whethered several bear markets. We never once had a margin call, our LVR was quite low (around 40%) and slowly our financial dam started to grow. No steps initially were ever taken without Emmanuel and Julie's personal stamp of approval.

Naturally our confidence in Storm grew and even when we felt nervous about the economic climate, we were assured that we, like always, would be taken care of and had nothing to be concerned with. But as the company grew, Emmanuel and Julies's involvement directly with us became noticeably less and less with our financial advisor being seen to steer the boat.

Yes, we should have not been so trusting but this was a trust that grew after many years. And we were trying to cope with our own busy lives in the meantime. My husband was trying to run his own business and although not aware of it at the time, battling an auto-immune disease. He had to close down the business three odd years ago as he could not go on and has been an invalid ever since. His doctors and medical expenses have been high, none of which we could obtain government assistance with due to our perceived assets level.

I work full time and have been studying part-time for the last two years as I intended at some future date to retire from my present position and work only casually in a better paying position with time to look after my husband as his condition worsened. (The fund had still not reached the $50K per year which we felt was reasonable to retire on.) I also have an ailing mother that I try to assist with.

So time to do anything else (like researching financial information) is a luxury for me. We realized Storms fees were high but have always been of the belief that you only get what you pay for. As we payed so much over so many years, we felt that we were getting the best advice.

Bottom line is that we now have a bank loan of $4300 odd in repayments per month that we have no way of servicing as I am the only income earner and my gross for the month is no where near that. My husbands super was cashed in back in July to pay off a non-tax claimable home loan that subsequently created equity that we then borrowed against to purchase more shares. So that has also gone. And because he is less than 60 years of age, he now has a taxable income of $99K to be considered at the end of the financial year.

Our only saving grace is that we do have enough funds from the down selling
of our shares to repay the margin loan. And enough funds in an account to make bank loan home repayments for around 8 more months whilst we try and sell our home. But what will we be left with when this happens....not much to rebuild our lives.

I just hope that my husbands condition doesn't worsen too quickly and I can get a 'little' put away in the meantime for when I will have to give up work and care for him. And we so did not want to have to depend on a pension or housing commission, the real reason behind wanting to invest to start with!!

Yes we are angry that we have both worked hard all our lives and now have nothing to show for it. Call us gullible if you must but please do not call us greedy or careless with our monies.....we truly don't deserve this judgement.

 

[cuttlefish]

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 take a lot of resentment in this comment - labelling anyone with an opposing viewpoint as a 'troll or plant' is actually quite cowardly in my opinion. Also these forums are not a 'Storm Support Group' they are a place for open, two way discussion.

Most of the people expressing an opinion in this thread have been posting on these forums for years, have no vested interest, and are only trying to offer their viewpoint for better or for worse.

 

[bazollie]

G'day Guys , I've been following this thread closely as I am aware of a number of people in the C.Q Region who have been adversly affected by this terrible breach of trust in a small part of the Financial World.
I think that Trevor_S's comments have been a bit harsh as we can always be very smug in hindsight.
There have been others as well who have been quite critical as well , but at the end of the day, we all make decisions based on gut feel, advice, what is the trendy product etc etc...

We can all sit back and say you should have done this that and the other , but there are some of us out there that rely soley on advice given by Solicitors, Financial Planners, Brokers, Mad Punters etc ...

I am sure that if my Parents or in laws were involved in something like this, I would be kicking myself for not being more interested or proactive about the whole thing.

The upshot is that there are numerous hard working aussies that have been affected and that we should be supportive of their situation, not dishing on these people for being greedy, uneducated, be positive, etc etc..

Who would have thought that going long on an investment in say RIO at $120 per share would have turned to sh%t now? Blue Chip shares you buy and just put in the bottom draw and come back in 5 years right!

So the All Ords are crap at the moment and a lot of our Super Fuds are crap at the moment as well. Let's all of us try and get through this and come out the other side. We can try and call this experience, but I can think of better ways to learn.

To all of you guys who have been stung, I pray that there is a solution for you and that you will be looked after by the "system"

To all of the knockers and the "told you so people" , ease off the guys hurting at the moment and maybe even show some compassion , because what goes around comes around!!

To the terrible greedy manipulators of this system, shame on you for betraying the trust of hard working aussies and hope that karma kicks in soon!!

Regards

Bazollie

 

[cuttlefish]

Storm clients may be interested to know that the Storm Investor Consumer Action Group (SICAG) are starting to get up and running and have started to put together a website (not quite finished but starting to look very good).

http://stormfinancial.info/index.htm

Geez - call me cynical - but looking at the web site they are stinging people $50 just to join this group.

 

[Sunder]

Geez - call me cynical - but looking at the web site they are stinging people $50 just to join this group.

Maybe the founding members are E & J Cassimatis?

Or am I just being too cynical here?

 

[Monario]

Geez - call me cynical - but looking at the web site they are stinging people $50 just to join this group.

True, they are charging, but its a small fee to pay in my opinion as these people are voluntering there time, they are highly skilled in there fields and in my opiion are the basis of a good group of people to start the ball rolling on all these actions.

I dont think we investors will get any finances back from this debacle, but if I can stop it from happening ever again, and be the precursor to more stringent regulations, etc. etc. I am fine with the 50...

They cant be expected to be paying for flights, fees for meeting venues, etc out of there own pockets...

 

[Monario]

Maybe the founding members are E & J Cassimatis?

Or am I just being too cynical here?

Ha, not cynical, just ........ well you work it out:

 

[stung]

Maybe the founding members are E & J Cassimatis?

Or am I just being too cynical here?

Maybe not E & J Cassimatis... but I am 90% sure that one of them is a dad of my Storm financial advisor.
If I am correct I cannot join this organisation because I feel extreme ill will towards this advisor. If I went along to a meeting I could not trust myself not to tell his dad what a manipulating, self serving, dispassionate son he has.
As I say I am 90% sure. If I am incorrect please forgive me. No point suing me anyway as I have no money. Storm saw to that.

 

[cuttlefish]

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.

The criticism is not so much about people not educating themselves about finance, but about people making commitments that they were realistically unable to meet. If someone agrees to take out a loan, with associated loan repayments set out in the documentation, when realistically they will not be able to make those repayments then there is a certain responsibility associated with that decision. It doesn't require several degrees to add up your income, take away your living expenses and realise whats left over is nowhere near enough to repay the loan you are about to take out.

 

[stung]

G'day Guys The upshot is that there are numerous hard working aussies that have been affected and that we should be supportive of their situation, not dishing on these people for being greedy, uneducated, be positive, etc etc..


To the terrible greedy manipulators of this system, shame on you for betraying the trust of hard working aussies and hope that karma kicks in soon!!

Regards

Bazollie

Thanks for the support Bazollie.

I had worked very hard and was careful with how I spent my money believing that I needed to pay off my house above all else. When I finally paid it off I knew I needed to be proactive and make my money work for me and not just stick it in a savings account.

I believed that as I did not have the knowledge myself I would be best to pay some one who knew what they were doing. Friends had suggested Storm, so I went along to see them.... the rest is history really.

To Anastasia, It feels awful doesn't it? I hope things work out for both of our families.

 

[Julia]

The criticism is not so much about people not educating themselves about finance, but about people making commitments that they were realistically unable to meet. If someone agrees to take out a loan, with associated loan repayments set out in the documentation, when realistically they will not be able to make those repayments then there is a certain responsibility associated with that decision. It doesn't require several degrees to add up your income, take away your living expenses and realise whats left over is nowhere near enough to repay the loan you are about to take out.

Exactly. People following Storm's advice made the conscious decision to borrow to unsustainable levels.
As Cuttlefish has pointed out you don't even need high school maths to do the above simple arithmetic.

That said, of course, I'm feeling very sorry for everyone who is affected.

But it's simply not reasonable to come onto this stock forum - which as has been pointed out is a place for exchange of views, most assuredly not a support group - and accuse anyone suggesting that some personal responsibility is involved is a troll and 'acting for the enemy'.

 

[Glen48]

Any one know Mr. & Mrs. C. CV's?
What is their back ground?

 

[ShareGuy]

Exactly. People following Storm's advice made the conscious decision to borrow to unsustainable levels.
As Cuttlefish has pointed out you don't even need high school maths to do the above simple arithmetic.

That said, of course, I'm feeling very sorry for everyone who is affected.

But it's simply not reasonable to come onto this stock forum - which as has been pointed out is a place for exchange of views, most assuredly not a support group - and accuse anyone suggesting that some personal responsibility is involved is a troll and 'acting for the enemy'.

I'm sure there is a bit more to it than just simple maths. If people raised the question of how they would pay the interest I'm sure storm just told them to capitalize it and never worry about paying it back. May be a stupid strategy but when a so called " professional" suggests it to an unsofisticated invester we all know the result...

 

[sails]

I'm sure there is a bit more to it than just simple maths. If people raised the question of how they would pay the interest I'm sure storm just told them to capitalize it and never worry about paying it back. May be a stupid strategy but when a so called " professional" suggests it to an unsofisticated invester we all know the result...

...and from the stories in this thread, "trust" appears to have played a major role in these FPs getting access to OPM (other people's money). IMO, the abuse of trust would have to be one of the lowest forms of deception...

 

[cuttlefish]

I'm sure there is a bit more to it than just simple maths. If people raised the question of how they would pay the interest I'm sure storm just told them to capitalize it and never worry about paying it back. May be a stupid strategy but when a so called " professional" suggests it to an unsofisticated invester we all know the result...

Hmmm ... borrowing money they can't afford to repay to buy assets in the peak of a bull market beleiving they will only increase in value. Sounds a lot like the strategies employed by a lot of 80's entrepeneurs. (of course when an entrepeneur does it and fails they are crooks, but when an 'aussie battler' does it they've been ripped off ).

Sure Storm were pushing people into this, very irresponsibly, and its understandable that some naive people believed the story too much. But unfortunately if you sign a commitment then you are responsible for that commitment. Thats the ugly facts of life. If Storm told them to commit fraud and sign a fraudulent document, is that still excusable because they were ignorant? Where does responsibility end?

The tax department doesn't protect you from criminal prosecution just because you use an accountant - you sign your tax return and you are responsible for checking it - no matter how complex and no matter if an accountant prepared the whole thing.

If you take out debt that you can't afford to repay then you better make darn sure that you are monitoring the assets that have been purchased with that debt if the sale of those assets is your only means for repaying that debt. After all - the debt that you signed for is your responsibility. If your financial advisor isn't giving you information that is appropriate then it IS your responsibility to ensure you get the facts that you need from them or take appropriate action if they are not forthcoming.

Its also worth noting that a lot of the people affected by this situation weren't financially naive and were bright and succesful (there were a lot of businessmen who would hopefully understand the responsibility involved in signing a legal document involving a financial commitment) and also a lot of them by the sounds of it were happy to ignore advice or warnings to steer clear of these products.

If you can't take responsibility for your failures then you can't take responsibility for your successes in my opinion.

 

[ShareGuy]

Hmmm ... borrowing money they can't afford to repay to buy assets in the peak of a bull market beleiving they will only increase in value. Sounds a lot like the strategies employed by a lot of 80's entrepeneurs. (of course when an entrepeneur does it and fails they are crooks, but when an 'aussie battler' does it they've been ripped off ).

Sure Storm were pushing people into this, very irresponsibly, and its understandable that some naive people believed the story too much. But unfortunately if you sign a commitment then you are responsible for that commitment. Thats the ugly facts of life. If Storm told them to commit fraud and sign a fraudulent document, is that still excusable because they were ignorant? Where does responsibility end?

The tax department doesn't protect you from criminal prosecution just because you use an accountant - you sign your tax return and you are responsible for checking it - no matter how complex and no matter if an accountant prepared the whole thing.

If you take out debt that you can't afford to repay then you better make darn sure that you are monitoring the assets that have been purchased with that debt if the sale of those assets is your only means for repaying that debt. After all - the debt that you signed for is your responsibility. If your financial advisor isn't giving you information that is appropriate then it IS your responsibility to ensure you get the facts that you need from them or take appropriate action if they are not forthcoming.

Its also worth noting that a lot of the people affected by this situation weren't financially naive and were bright and succesful (there were a lot of businessmen who would hopefully understand the responsibility involved in signing a legal document involving a financial commitment) and also a lot of them by the sounds of it were happy to ignore advice or warnings to steer clear of these products.

If you can't take responsibility for your failures then you can't take responsibility for your successes in my opinion.

I am actaully an accountant and can tell you that if we breach our duty of care to our clients we will be in serious trouble. I've seen the position alot of storms clients are in and not one of them hasn't said "we were stupid to do this". But that doesn't mean we should let the principles of storm off the hook and just say "ha ha how stupid are you!" to people who go involved.

Personally I don't know how storms FP's can live with themselves.