I've got a new nickname for ASIC - MIRROR - that's right we'll look into it....
ASIC survey reveals the obvious: losing money hurts
Scott Rochfort
May 20, 2011
The ASIC chairman, Greg Medcraft ... mood cards a helpful tactic.
In a huge relief for the many thousands of investors left financially ruined by the collapse of numerous financial firms and schemes across the country, the corporate puppy dog has finally cottoned on to the idea that losing money can be rather upsetting to people.
The Australian Securities and Investments Commission's new head corporate grime fighter Greg Medcraft hit the ground running yesterday, when the regulator released a groundbreaking study on the ''social impact of monetary loss''.
The report assessed the feelings of 29 people who had been issued margin calls or who had lost money in various mortgage or agribusiness schemes.
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''The main finding of this study is that failure to fully compensate investors who lost money because of the conduct of their managed investment scheme or financial planner can cause the investor severe emotional and financial distress,'' concluded the report.
The study identified four degrees of ''suffering''. They were ''catastrophic; living frugally; financially settled but angry; and accepting''.
''All of these investors experienced different degrees of financial and emotional distress,'' said the study. While financial planners copped the brunt of the anger of the 29 investors interviewed, ASIC did not come off lightly either.
''Several investors told us that they contacted ASIC when they could see problems with their funds, or after the funds crashed, but ASIC was unable to help.''
One of the unnamed interviewees in the study said: ''The minute they stopped paying us and started borrowing money from the [bank] I contacted ASIC and they said, 'We are keeping a strict eye on it and we are looking at it' and that was the answer I kept getting all the time, 'we are looking into it' but they never did anything about it until it was far too late."
Seems the survey came a few years too late for ASIC.
ON THE CARDS
One wonders why ASIC bothered hiring someone to survey 29 people. Surely it would have had plenty of feedback on its own complaints line. One of the case studies in the report was a disability pensioner living in ''catastrophic hardship'' after losing her inheritance in a failed property investment scheme. ''She will have to move when the rent goes up. She is considering a granny flat in someone else's backyard or selling her car to buy a campervan,'' said the case study.
The woman told the study: ''Bury me in a cardboard box.''
The survey of the 29 investors in the ASIC study included cards to help people express how they thought. There were cards with the words: Ashamed, Embarrassed, Angry, Depressed, Cranky, Sad, Calm and Resigned. There were cards with mood diagrams.
Read more:
http://www.smh.com.au/opinion/asic-...money-hurts-20110519-1ev15.html#ixzz1MqsapCcl