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BFCSA: Bank Engineers/ Manufacturers of faulty finance products BOQ and Macquarie order to compensate. Class Action looming against ASIC

Posted by on in ROYAL COMMISSION URGENT
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We have arrived:  The Big Bank Scandals - let the games begin!

http://www.abc.net.au/pm/content/2013/s3770355.htm

ASIC threatened with class action after Storm settlement

Justine Parker reported this story on Wednesday, May 29, 2013

ASHLEY HALL: The corporate watchdog says it's had a significant victory in the long-running saga of the failed investment company Storm Financial. Lenders, including Bank of Queensland, Macquarie Bank and Senrac, have agreed to pay a total of $1.1 million to compensate two former Storm investors in an out-of-court settlement.  But lawyers representing other Storm investors are now threatening to launch a class action against ASIC. They say ASIC has dropped the ball on this case.

Justine Parker reports.

PETER KELL: The settlement reached today with the Bank of Queensland and Macquarie, have agreed to pay $1.1 million to the Doyles, Barry and Deanna Doyle. That's full compensation for the financial loss arising from their Storm investment. So it's a very significant outcome for the Doyles.

JUSTINE PARKER: That's Peter Kell, the deputy chairman of the Australian Securities and Investments Commission. He says today's $1.1 million settlement will serve as a template for at least three other class actions that have been filed by Storm Financial investors.  Storm collapsed in 2008, leaving thousands of retirees with millions of dollars in losses. It also left a complex web of court challenges and class actions that are still grinding on, five years since Storm went under.  Mark Weir is joint chairman of the Storm Investors Consumer Action Group. He says he's happy for Barry and Deanna Doyle, the Queensland pensioners who were compensated in today's out-of-court settlement. But he warns it's too soon to tell if this can help the hundreds of other investors still out of pocket around the country.

MARK WEIR: Well I certainly hope that when the water becomes clear that it does translate into something for those other investors other than the Doyles.

JUSTINE PARKER: But lawyers representing those other investors have already made up their minds.  Here's Stewart Levitt, the principal of Levitt Robinson Solicitors.

STEWART LEVITT: This is not a test case, because it wasn't agreed to be a test case by the courts or the banks and ASIC. It's not a legal precedent, because they have settled the case, they haven't run it. So it's not authority for anything. It binds nobody.

JUSTINE PARKER: Mr Levitt's now threatening to launch a class action against ASIC over its handling of the case. Stewart Levitt again.

STEWART LEVITT: We also have ASIC in the gun, and we're intending to bring an action against ASIC because it's ASIC that allowed all this to happen. They watched it for 10 years and approved it and even endorsed it. We have many instances of people who tell us that, before they invested in Storm, they contacted ASIC and said, 'should we?' And ASIC said yes. And this was to self-funded retirees.

JUSTINE PARKER: But Peter Kell denies ASIC dropped the ball on this case.

PETER KELL: Well we have pursued the Storm collapse very vigorously, through the courts and through negotiations with the financial institutions involved. Of course, we still have outstanding action as well against the individuals that actually were running Storm in the first place.   So this has been one of the most significant collections of legal actions around a financial collapse in Australia's history. This is very significant and it shows that ASIC will make strenuous efforts to pursue justice for the investors. But these are very large and complicated cases and the unfortunate reality is that it takes a fair bit of time for these matters to work their way through the courts.

JUSTINE PARKER: Stewart Levitt says he's already had at least 200 Storm investors express interest in his class action against ASIC. He expects to launch that action in the next couple of months.

 

ASHLEY HALL: The Bank of Queensland says it's pleased to have a resolution in this matter, but it won't comment further because other Storm cases are still running. Macquarie Bank isn't commenting at all on the case.

That report from Justine Parker.

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  • setup
    setup Monday, 15 September 2014

    Mr and Mrs Doyle are indeed very fortunate but why did it take so long to settle one case? Now they have hundreds more to settle and how long will that take?
    Asic should be made to pay towards some of the settlements because it was they who allowed this to happen.

  • Susan
    Susan Monday, 15 September 2014

    How about ASIC use its $500,000,000 annual budget to pay these people??
    That way, the budget would be put to good use for a change.

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