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BFCSA: 16,000 Banksia Victims angry at ASIC NEGLECT and the agony of LOSS

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Most of the 16,115 Banksia victims could have been spared the agony of financial loss.  The Australian Securities and Investment Commission ("ASIC") knew this company was in risky waters in 2005.  More importantly ASIC knew that to protect consumers, full audits should have been carried out by ASIC on each of these companies if Trustees were deemed to be out of line and incapable of being objective.  

The regulator could have stopped Banksia from trawling further for customers.     Meetings, discussions and reports took place on over 90 "Westpoint lookalikes" and Banksia was certainly on their written list.  So why was Banksia under their attention?  ASIC was also critical at the time of Trustees in a number of similar businesses.

In terms of Consumer Protection, ALL ASIC NEEDED TO SAY to Consumers was:  GET OUT , GET OUT, WHILST YOU STILL CAN!!!!!!  


Due to ASIC's neglect, $1 million worth of funds left in the ruins of the Banksia collapse, has been utilized by the receivers for four weeks work and each of their employees are given $210 per hour.  We wish!   Receivers, Administrators, Liquidators do not come cheap.  The hapless investors are left to pick up the bill, after just being told their Christmas is in tatters and, only 20% has been returned.  The clean up could take 7 years to recover portions unknown.

The worst news for investors being that their carefully planned income has ceased and retirees are thrown into instant pensioner mode.  The process of begging for funds from Centrelink only compounds the agony and embarrassment for mostly elderly retirees.

Borrowers are also thrown in turmoil as they are advised to refinance elsewhere or lose their homes.  Key indicators suggest the borrowers are pensioners on two year loans and capitalized interest plans.   Glory be!  

The "assets are less than impressive vacant blocks of land" and not an income stream in sight.  There are no winners here except for the promoters and receivers who are receiving monies for the moment.

Over $660 Million gone and ASIC just chalk another collapse on the blackboard/whiteboard.  

ASIC MUST PAY THE COST OF RECEIVERSHIP and/or ADMINISTRATION and LIQUIDATION.  Consumers should not be left to cover these costs.  

What sort of a democratic system does that?  The idea is truly barbaric.

ASIC MUST SET UP A CONSUMER COMPENSATION FUND and start repairing some of the financial damage to ordinary Australian Citizens.

Consumers can no longer trust regulators to watch the financial markets.  Corruption is obvious and has been lying low for 14 years.  

It is now time for Consumers to band together and insist that ASIC clean up yet another diabolical mess of their own making.  ASIC relied upon the auditors and trustees yet obviously had strong inklings that not all was running swimmingly down at Banksia

Dear Mr Medcraft - Since ASIC KNEW the risks were there; KNEW the vulnerability of those being spruiked to invest; KNEW, as Joe Hockey recently attested to that NON BANK LENDERS are unsafe and why and; KNEW that ASIC in good conscience ought to pay the receivers and everyone else that follows in the Banksia saga.  

It is long past the point that you as Chairman, step up to the plate and tell these people the truth:  this will take years to sort out and you and I know why.

If Investors have funds in any of these "lookalike" businesses then perhaps they should reconsider their position as to risk.  Just ask the victims of Westpoint, Trio, MFS, Fincorp, ACR, Storm Financial, Provident Capital and a host of others.

The total pot was estimated as $80 Billion in 2007.  All deemed "risky."  It took a few RECA Members (the old BFCSA forerunner) 3 years of lobbying to 2007 to have this situation revealed.  

This email address is being protected from spambots. You need JavaScript enabled to view it.

PS:  ASIC's neglect in the Stuart Ariff case has caused the death of one of its victims this Christmas.  

Our sincere condolences to the family.





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  • doyla66
    doyla66 Thursday, 27 December 2012

    This is what the stupid Government either fails to understand or deliberately ignores in these failures - CENTRELINK. The process of begging for funds from Centrelink now starts.

    This will now cost the Australian Government & Australian taxpayer many more Billions, as the Government will now have to pay out more money, over many years, to help support these people that have been ripped off in these PONZI schemes.

    If the totally useless ASIC & the other useless so called 'regulators' did the jobs that they are paid to do in the first place, then these types of collapses would be prevented.
    But as we all now know, ASIC do nothing. ASIC refuses to take any action.
    Corruption is systemic in these organisations.

    I would urge everybody to withdraw their money from any scheme like this - immediately - because until we have effective 'regulators' & prosecutions of the criminal directors perpetrating these schemes, this WILL keep happening - again & again & again & again & again & again & again.......

    I know this from personal experience, as my mother-in-law & father-in-law very nearly lost their entire life's savings when Bridgecorp collapsed in 2007.
    They were continually assured that it was a "risk free" investment.
    They were continually assured that it was "a safe" investment.
    They were continually assured that it was a "couldn't lose anything" investment.

    Well what happened? : Thousands of people DID LOSE EVERYTHING!
    Millions of dollars went "missing."
    It wasn't "safe", & it wasn't "risk free."
    The directors ended up in Jail.

    My in-laws - by pure chance, by pure luck - withdrew all of their money - ONLY 3 WEEKS BEFORE THE COLLAPSE, otherwise they too would have lost everything!

  • doyla66
    doyla66 Thursday, 27 December 2012

    I'm sure everyone concerned will appreciate your very wise warning Wayne. Our foolish government doesn't have a brain in their head to understand that prevention in the first place is better than treasury paying out unnecessary money after the damage has been done. Wake up tax payers and know that what we are telling you is true. This is a vicious circle - the banks steal homes by forging details on Loan Application docs, then the homeless are forced to rely on the useless Government for housing and Centrelink for financial support which in turn drains the Government purse causing taxpayers to pay more tax. So in the long run it is not the inactive Government who suffers, it is the people - everyone of us is affected. Our leaders will always make sure that these scams will not affect their very comfortable lifestyle. If the politicians were smart they would save the country millions of dollars but history shows their lack of concern toward their people in need. THEY DO NOT FAIL TO UNDERSTAND - THEY DELIBERATELY IGNORE - IT DOES NOT AFFECT THEM. THEY HAVE THE "BUGGER YOU JACK I'M OK" ATTITUDE. If they are incapable of running our country then boot them out. THEY ARE ONLY THERE FOR THEIR OWN BENEFIT AND DON'T GIVE TWO HOOTS ABOUT THE FINANCIAL STATUS OF OUR COUNTRY.

  • Denise
    Denise Friday, 28 December 2012

    Irrespective how ASIC wriggles out of these situations as it invariably does, the institution has a specific duty of consumer protection. These horrendous losses have escalated beyond belief due to ASIC’s neglect of those duties. It clearly KNEW what was likely to occur and was in a position to see outcomes and value of damage. ASIC maintained Disclosure Policy to prop up the industry, not to PROTECT CONSUMERS.

    The problem lies here: ASIC will say they were under Government Policy (we know that) But Government states ASIC acts autonomously. So I questioned ASIC: "was it Government pulling Disclosure Policy on ASIC's strings OR your policy agenda?" Just a nod towards Canberra......ASIC admitted recently: "Disclosure Policy does not work....meaning tens of billions of dollars is LOST. Then there is the cost of CENTRELINK picking up the threads of people's shattered lives. What Governments or Regulators do such a monstrous thing to their own citizens?

    ASIC's response 2005: "Denise if you had our funding you would be positively dangerous." To whom...the banks and non bank and ASIC chiefs?

    [email protected]

  • doyla66
    doyla66 Saturday, 29 December 2012

    I wholeheartedly agree with the statement, "ASIC TO PAY THE RECEIVER COSTS"!

    ASIC, once again as they always do, FAILED in their appointed duty. Now, there is a cost that should be paid for the dereliction of that duty. Isn't it more commonly known as, 'there are consequences to your actions'? Or, in the case of ASIC, lack of action.

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