To SJG 1974
"OK let me be blunt.
1. I do not for a second believe anyone who says they signed on to the strategy thinking it was low risk. I don’t buy it. To be frank, if anyone on this forum thought that double gearing into shares is low risk, then they are incredibly naive or liars. And I don’t think people are that naïve.
And on that, just when did clients realise that their supposed low risk strategy was in fact high risk? When their portfolio was down 10%, 20%, 30%, 40%, 50%, 60%? When $1 million of investments had been turned into $100,000? When did the penny finally drop? And what did they do about it? Oh yeah that’s right, just stuck it out until the bitter end. Yep, that makes sense.
2. I also don’t believe people who say there was no carrot dangled in front of them. People don’t pay hundreds of thousands of dollars in fees to simply receive financial advice. You don’t pay hundreds of thousands of dollars in fees to have a third party protect the money you already have. Go back through the website…it talks about putting you in touch with strategies that are the domain of the rich. Again, I don’t buy it.
3. Yes the strategy was flawed, but I also don’t entirely buy the line that Storm was out to fleece its clients. We have heard that many Storm advisers invested in exactly the same strategy as the clients did. Why, if they KNEW the strategy was flawed would they invest in it themselves? Why would they risk their own livelihood in undertaking the same strategy you did? I truly believe that they thought it was a legitimate strategy. This makes them bad financial advisers…it doesn’t mean they were out to solely screw clients.
So where does that leave me? It leaves me believing that clients knew they were taking a risk with what they were doing. They took the risk because the rewards on offer were so attractive. It doesn’t mean they were greedy, it just means they were prepared to take a risk to chase a better life. A big risk. Risk vs reward…a concept as old as investing itself.
And now that they have lost everything, they “play dumb”…I didn’t know it was risky, I only wanted a conservative strategy, I didn’t want to make money, I only wanted to protect what I had. Again, I don’t buy it. Not for one minute. And you don’t keep believing it as your wealth gets eroded by the day over a 12 month period….as the debts mount and the investments fall. Again, people aren’t that naïve.
Its kind of funny that throughout this forum Stormers have been passionate in questioning the motives of the banks and Storm in all of this, of the key players and how their reason for being is to screw people over. They have questioned the truthfulness of the things key players have said. Yet we are expected to believe everything Stormers have said about their motivations and involvement with Storm because they are the victims. Again, to be blunt, just because people are “victims” doesn’t mean I believe everything they say, particularly when it flies in the face of common sense.
To repeat myself for the umpteenth time, IF the banks and/or Storm are proven in court to have broken the law, then I have no issue, NO ISSUE AT ALL with them paying the price for this. NONE WHATSOEVER. No matter what the industry, no matter what the company, consumers should expect that the laws will be followed.
I have no issue with people pursuing justice and compensation. None whatsoever. I would do the same if I were in your shoes.
The thing for me is that the banks and Storm didn’t CAUSE 100% of Stormers losses...clients agreeing to go ahead with a risky strategy and a small matter of a GFC played a very big role, yet people are prepared to blame them 100% for the losses they suffered. And I don’t think that’s right.
Stormers made the choice to take up the strategy. They took the risk. They stuck with a “conservative” strategy as their losses kept on building up over time when they could have jumped out. They should be prepared to accept at least some responsibility for what happened…not full, but at least some, because everything they did, from taking on the strategy, to borrowing from the bank, to investing in shares, to sticking it out as their investments fell over time, it was their choice to do….no one else’s.
Okay! You have left no one in any doubt how you feel. You are entitled to your opinion and I think we must all respect that, daft as it appears to us in the present circumstances. Why do you therefore feel that you have to repeat this mantra ad nauseam? After all, you claim that its starting to tire you out! If you want to think this way, so be it! Frankly, who cares what you “buy” anyway? We certainly don’t! Give yourself a rest by all means because you thoroughly deserve one.
We, of course, are entitled to our opinion too and, needless to say, it doesn't agree with yours.
Where Storm is concerned, my argument has always been that we ‘Stormies’ had no reason to suppose that we could not TRUST Storm to do the right thing by us. We had no reason not to TRUST the advice that firm gave us. We had no way of KNOWING that Storm’s “triggerpoints” would not be acted on. We had no way of KNOWING that Storm would go against our wishes and place our assets at ‘high risk’. (This was not what we agreed to when we signed up with Storm - our agreement was for "low risk" with "growth over the long term"). We had no way of KNOWING that Storm had formulated separate agreements with the Macquarie Bank and the CBA that would dictate how they all reacted in a crisis. We had no way of KNOWING that Storm’s emergency plans were non-existant. We had no way of KNOWING that Storm’s PI insurance wasn't worth the paper it was written on. We had no way of KNOWING that ASIC’s compliance audits were inadequate. We had no way of KNOWING that the Government’s regulations at that time in relation to the financial sector did not fully protect investors against the likes of Storm. Therefore, there’s no bloody way I’m going to concede that I or any other "Stormies' were in any way to blame for what these rogues and their accomplices, the Banks, did to us. They are all now in the dock, not us, and no one should forget this. If there’s any recriminations involved, it should lie squarely with them for using our assets for their own selfish ends.
I therefore suggest that you stop twisting the facts to suit your argument or deem to tell us what our motivations were when we signed up with Storm. Nor try to tell us what we did and didn't do at that time. How can you when you weren't there?
The enlightened ones on this forum that consider themselves far too intelligent to be taken in by Storm tend to forget that when we invested in Storm, that financial advisory firm had a track record; were sanctioned by ASIC; had affiliations with major banks; had a considerable data-base of clients; had sizeable assets; and were touted by all as a progressive financial advisory firm. We were assured that Storm had the latest software and systems that would keep them and us abreast of our financial position at all times. We now know that we were lied to from "go to woe!".
Today, the enlightened ones on this forum call us financial speculators that were blinded by greed. Why? Because they have the benefit of hindsight which, we all know, is a wonderful thing! It’s a pity that no one in the financial industry or ASIC voiced their concerns during the years before the Storm collapse so that we could have been warned well in advance?
You are now trying to paint a picture that is completely at odds with the facts. I therefore suggest that you take the time to read through the Worrells report, the PJC findings, the transcripts taken when the Banks' executives appeared before the PJC, the ASIC reports and so on. Nowhere in any of this documentation does it describe Storm's investors as "high fliers" and "risk takers" and seek to lay some of the blame at their door! I prefer to rely on this body of evidence rather than consider anything you have to say seriously particularly when such comment is ill-informed.
Having one's head in the sand does not allow anyone to see what is going on around them. Then again, perhaps they prefer the sand to the truth anyway?
In the end the court will decide whether the Banks and Storm’s directors for that matter have a case to answer. Not you or anyone else on this forum! Therefore you can keep repeating yourself to you are blue in the face. It will have no impression on us because your opinion doesn’t matter one iota in the end. It's just your opinion and carries no weight at all.
The only thing that matters to ‘Stormies’ now is our forthcoming court case. We will place our faith in the Law because at the end of the day it is there to protect people like us; not those that have done the wrong thing by us. We are content to let those that are better equipped to judge and decide who is right and who is wrong, laying the blame accordingly. I seriously doubt though that no matter what the outcome, any court will rule that we Storm investors were a bunch of "risk takers" that deserved everything we got! Justice may be blind at times, but she will never be as blind as those that refuse to see on this forum, no matter what is said or the body of evidence that is presented to them.