Storm Financial Group

[Julia]

Harleyquin, an honest post. Thousands of people will be as you were.

I wish you whatever sort of recovery you're able to make and hope time treats you with more kindness than in the last few years.

Julia

 

[bunyip]

I would like to share some GOOD news on StormFinancial - Yes, I borrowed, Yes I trusted an ASIC accredited financial adviser and Yes I lost a bomb - but the good news is the original deal gave me an incentive, confidence and initiative to quit my 9-5 job (gave me great pleasure telling the boss what she could do with her job) and start my own business which has gone very well indeed.

I work 2 days a week and make 3 times what I made in the 9-5, I am my own boss, I employ someone part time to assist me and have recouped a lot of what I lost.

Thank you Storm Financial but I am disappointed with ASIC and the lawyers who are feeding sumptuously on the storm carcass - as someone said many posts ago, the only ones to profit from this will be the lawyers.

I am now more discerning and will never trust anyone again with my money - I make my own investments now so I now know who to blame if it goes belly up.

But I would like to see someone join Bernie Madoff in the clink, but with ASIC running it then I doubt it very much.

Sailteam

Well done on having the courage and initiative to branch out on your own – may your success continue.

 

[Judd]

It's a good question, Harleyquin. I don't have an answer for you unfortunately. You're no different from many in that you're busy, rushing around and the like. I was in the same situation. Some simply think and view things from another perspective.

As silly example, I was at a friend's home and the lady was enthused about her new dishwasher. I assumed the old one had broken but no they had updated as the new one would save 8,000 litres of water a year. Laudable objective. Yet on the way home I wondered how much 8,000 litres would cost. Turns out around $18. So the lady disposed of a perfectly good dishwasher, spent say $800 in order to save $18 a year and thought the purchase was on the upside. Sure looked nice but...........

Not a clue as to why some people think in different ways. Just happens.

 

[Harleyquin]

Bunyip I have never 'asked for all my money back'. I knew there was some risk, however we thought with an ASIC backed planner and major banks involved PLUS asking for a low risk financial plan, would guarantee us that we would find ourselves in the best possible financial position in retirement. We were never going to have enough money to be a fully self funded retiree even with a financial plan in place.

I now realise that my lack of financial 'know how' and placing our trust in these people to give us the best possible financial results have made me the ideal 'muppet' as GG has often called us. Since the storm collapse we have all found out that there was a great deal going on behind closed doors that could very well be called 'highly unethical' at best. Hindsight is wonderful, had any of us known what was really going on, we would have run a mile.

Instead of the instigators of this collapse acknowledging any complicity, it has been 'easier' for all concerned to ' just blame the victims' by calling them greedy etc, which I know is not true.

The other big problem with this collapse has been the lack of support for the victims. One day we have a home, a job, our health and a financial plan in place. The next we have it all taken away, the distress has been horrific, far worse than anyone who has never experienced it, to even imagine. Unless it happened to you, you would have no idea. Suicides have and are continuing to occur because so many have been left with nothing and nothing to look forward too.

Most of us have contacted all the support organisations, but with this level of devastation they are really unable to help. We have been left to continue to take high dosages of anti depressants and sleeping tablets so that we can try and cope somehow. If this type of collapse occurs again, and I believe that it will, there needs to be a specialist group in place where we can get some real support and not just some bandaid solution.

Now that the present government has reversed most of the recommendations put in place by the previous government, they are guaranteeing that a similar crash will occur. The banks have the money to fight any allegations in court, the victims don't have anything to fight for justice.

 

[bunyip]

Now that the present government has reversed most of the recommendations put in place by the previous government, they are guaranteeing that a similar crash will occur.

Further market crashes will occur regardless of which political party is in government, and regardless of what policies, rules, or regulations they have in place.
As always, some people will get badly burned by these crashes while others will profit from them.

Can you elaborate on which of the previous government's recommendations have been reversed by the Abbot government?

The banks have the money to fight any allegations in court, the victims don't have anything to fight for justice.

A number of people pointed out many times on this forum that this would be the case.

 

[Harleyquin]

I'm well aware, as you are, that market crashes can occur under any government Bunyip.

I don't need to elaborate on the changes that the Abbott government have reversed, they have been well documented in the media..

The last comment was well worth stating again.... and again and again if necessary.

 

[DocK]

http://www.smh.com.au/federal-politics/political-news/tony-abbotts-proposed-financial-advice-red-tape-cuts-could-raise-risk-20140319-352vv.html

The above article covers the gist of it. I understand that a lot of financial planners are themselves against a return to commission-based remuneration rather than a fee-for-service as they feel it gives the large banks a vast advantage over them.

 

[bunyip]

I don't need to elaborate on the changes that the Abbott government have reversed, they have been well documented in the media..

I recall hearing something about it, but I didn’t take much notice because in my opinion the ‘recommendations’ put in place by the previous Labor government did little or nothing to stop people from getting caught up in another investment debacle.
So I think it would have made little difference whether Abbot kept Labor's recommendations or scrapped them.

 

[poverty]

'Stormies' took a punt on the stock market with borrowed funds and lost, just like many have before them and many will after. When you make a wager and you lose you sack up and pay the man. No crying for your money back, you lost fair and square. 'Oh but I didn't know!' 'Oh I came to Storm for 'help' and they took advantage of me!'. I just don't buy it, it was either greed or ignorance that led people down this path and they can't blame anyone but themselves. If you feel the need to lodge a complaint the first place to look is in your bathroom mirror.

 

[pilots]

'Stormies' took a punt on the stock market with borrowed funds and lost, just like many have before them and many will after. When you make a wager and you lose you sack up and pay the man. No crying for your money back, you lost fair and square. 'Oh but I didn't know!' 'Oh I came to Storm for 'help' and they took advantage of me!'. I just don't buy it, it was either greed or ignorance that led people down this path and they can't blame anyone but themselves. If you feel the need to lodge a complaint the first place to look is in your bathroom mirror.

This has to be the best post on storm ever.

 

[Harleyquin]

Your callous comment 'poverty' shows how little you know or care about what really occurred before the crash.

We all have a far better idea now, what was really going on behind the scenes, so it's easy for you to make assumptions.

Had I been aware of just what was occurring I would not have had anything to do with Storm Financial.

The salesmen at SF were far more skilled at selling their product than you can imagine. We have been accused many times of not asking all the questions, believe me, I wrote down everything I could think of, to ask them. The answers we were given, and accepted, were simply not true.

None of us wanted to just risk everything on the stock market, quite the opposite in fact.

'What happened' and ' what we were told would happen' were very different scenarios.

Also it was easy to fool us, as we had no experience with the stock market and how it all worked.

 

[Ferret]

None of us wanted to just risk everything on the stock market, quite the opposite in fact.

'What happened' and ' what we were told would happen' were very different scenarios.

That's very interesting, Harleyquin. So did they tell you your money would be invested in a mix of asset classes?

My understanding was that Storm only used share market index funds and if they told you otherwise it would have been an outright lie.

 

[joku]

That's very interesting, Harleyquin. So did they tell you your money would be invested in a mix of asset classes?

My understanding was that Storm only used share market index funds and if they told you otherwise it would have been an outright lie.

You've missed what he was trying to say there. He meant not risking it all on the stock market as in not risking house / livelihood due to leverage. I think most would have walked into storm planning to invest some spare cash they'd prefer not to lose but ultimately could. Whether it be greed, ignorance, stupidity, gulibility etc etc many left with their financial livelihood on the line. They had to have some idea but it's fair to say few would have left with anything even close to a good understanding of the relatively high probabilty for loss or the real potential extent of those losses.

 

[Judd]

You've missed what he was trying to say there. He meant not risking it all on the stock market as in not risking house / livelihood due to leverage. I think most would have walked into storm planning to invest some spare cash they'd prefer not to lose but ultimately could. Whether it be greed, ignorance, stupidity, gulibility etc etc many left with their financial livelihood on the line. They had to have some idea but it's fair to say few would have left with anything even close to a good understanding of the relatively high probabilty for loss or the real potential extent of those losses.

Regarding the part I have underlined, after many attempts at understanding, this is the overall view I arrived at in regard to the vast majority of former clients of Storm Financial.

The power of advertising is amazing when only the good aspects are stressed and the not-so-good aspects are muted. Storm was about advertising in my view. All done legally with every single compliance box ticked and checked as required. What on earth could go wrong?

 

[bunyip]

They had to have some idea but it's fair to say few would have left with anything even close to a good understanding of the relatively high probabilty for loss or the real potential extent of those losses.

Which is why ‘poverty’ stated realistically that it was either ignorance or greed that led Storm investors down the path they chose. Yet he was labelled as 'callous' for making that statement.

 

[Harleyquin]

Sorry I don't understand exactly what those all are as I've never had anything to do with shares, all I know is that they weren't just ordinary shares, they were supposed to be safer, but I don't understand how or why. That's why we asked someone who knew what they were talking about. I still don't understand why they are now considered so dangerous? All I do know is that you ask for help, think you're doing the right thing, and next thing you're being accused of being greedy etc etc, I'm sooo over all the corruption involved in this case. I do wonder if the people at ASIC who are supposed to regulate this industry and those banking people who were prepared to lend the storm advisers unlimited funds, realise just how much damage they've done to so many, who went to a financial adviser thinking they were all trustworthy if they had all the right bits of paper. Today we know different. If we had just lost some money because of the GFS that we could accept, but to lose everything when you think you've got a conservative plan is soul destroying. So many lives have been destroyed. I know that those of you who do understand storms investment strategy will disagree with me and the more I try and understand exactly what they were up to, the more I understand why some would think we were just being greedy. None of us and our families will ever forget or forgive what these people have allowed to happen.

 

[Judd]

Harelyquin,

Yes, it can be very difficult and confusing especially where it is not clearly explained to you the possible ramifications.

It wasn't the shares. Their prices go up, they go down, they go sideways. My understanding is that the advisers of Storm Financial placed the clients into index funds which are just a baskets of shares reflecting the sharemarket itself. Nothing particularly special or dangerous about them. There really isn't.

The major danger you faced, and this was the part which was obviously not explained in full, was the amount of debt Storm encouraged people to take on to buy those index funds. That is what wiped people out. The more the market fell, the lower the value of index funds went but the debt you owed didn't. In the end the amount you owed to buy the index funds was way more than the value of those funds. And the banks wanted the money they lent to you even though you didn't have any.

I really cannot explain it in more simpler terms.

 

[Harleyquin]

Thanks Judd appreciate the explanation. My most pressing problem at the moment is that I need some financial advice desperately and have no idea who to trust. Our whole life has been turned on it's head. I regret the day I ever decided to seek financial advice. So what's my next step???

 

[DocK]

Thanks Judd appreciate the explanation. My most pressing problem at the moment is that I need some financial advice desperately and have no idea who to trust. Our whole life has been turned on it's head. I regret the day I ever decided to seek financial advice. So what's my next step???

I have no idea if they're what you're looking for, or whether their services are top quality or not, but here's a link to a free financial counseling site that may be useful: http://www.financialcounsellingaustralia.org.au/Home

 

[Harleyquin]

Thank you Doc appreciate the link.