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ASIC’s Storm Financial intervention prompts outcry from lawyers
A recent Storm Financial settlement caused quite a bit of controversy and resulted in an appeal from the regulator. Milana Pokrajac finds many in the legal community deem the regulator’s intervention unwarranted and unnecessary.
Just giving back part of the loot and giving the banks a slap on the wrist is hardly my idea of justice.
Noting that we (and I say we, I was invested in Storm as well) shouldered our share of the risk, and didn't complain when the profits were rolling in, I say partial compensation was more than fair. I am happy with what I got back.
Macquarie and Storm victims settlement "wrong": Court
Levitt Robinson estimated that under the settlement, around 315 investors who funded the class action would have been reimbursed their legal costs and also compensated for approximately 42% of their losses.
At the same time, around 735 Macquarie borrowers would only get back about 18% of their losses.
The Court determined that the levies were not calculated mathematically and that the amounts were not proportional to the losses suffered by the investors. However, it didn't question the size of the settlement pool.
"The principal issue on appeal is whether the primary judge erred in finding that the distribution of the settlement sum as between all group members was fair and reasonable," the Court said.
He didn't mislead you. I have the same paperwork that you do, and it details very clearly that investing in shares is a risky practice...even if that risk is only 1%, we copped the 1%.
You are not going to get all your money back + extra, no matter what rationale you try and espouse my friend. I suggest you divert your energy into enjoying the rest of your life, the Storm is over; and as GG has said numerous times now, the only winners from here on in are the lawyers.
Getting half your money back is actually a blessing.
The truth of the matter is that both the CBA and the Macquarie settlements are basically unfair because they only provide for partial compensation.
Just giving back part of the loot and giving the banks a slap on the wrist is hardly my idea of justice.
Federal Court of Australia decision in relation to Storm.
The transcript of the Full Court's decision is below.
http://www.austlii.edu.au/cgi-bin/s...ml?stem=0&synonyms=0&query="Storm Financial "
The fourth difficulty with the Funders’ Premium was that it was payable to Funding Group Members. The Settlement Distribution Scheme defined that as “group members who were clients of Levitt Robinson as at 15 March 2013 who contribute to the funding of the Class Action up to the date of the Approval”: see [29] above. As noted earlier, it included any group member who was a client of Levitt Robinson who made a contribution of at least $500 so long as they were a client of Levitt Robinson prior to the date the Settlement was approved. As a result, 13 clients of Levitt Robinson became Funding Group Members even though they did not contribute $500 until after the settlement was reached. That step, of itself, was not fair or reasonable. It was not fair or reasonable because none of the group members who were not clients of Levitt Robinson were afforded the same opportunity to participate at such a late stage for as little as $500. Why should those 13 Levitt Robinson clients be afforded that opportunity at the expense of the Unrepresented Group Members? The answer is they should not. The matter may be tested this way – if there had been a prospect of a premium as a reward for funding the litigation, some of the Unrepresented Group Members may well have decided to fund the litigation. Indeed, it is likely that there may have been a rush of Unrepresented Group Members if they had been given the same opportunity at that time. They were not given that choice. The terms of the distribution of the Settlement Pool should not prejudice the Unrepresented Group Members for having made an informed decision on one basis which the Funding Group Members now seek to change to their advantage but to the disadvantage of the Unrepresented Group Members. That is neither fair nor reasonable.
He didn't mislead you. I have the same paperwork that you do, and it details very clearly that investing in shares is a risky practice...even if that risk is only 1%, we copped the 1%.
Does any part of your paperwork state that the Storm strategy was ‘no risk’, or that it was safe and conservative?
Perhaps so, Judd. But also unnecessary are the posts a few days ago from a Storm investor who complained about having been treated unjustly by being granted only partial recovery of his losses.Aww, man, no need to rub peoples' noses in it. Unnecessary.
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