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BFCSA investigates fraud involving lenders, spruikers and financial planners worldwide.  Full Doc, Low Doc, No Doc loans, Lines of Credit and Buffer loans appear to be normal profit making financial products, however, these loans are set to implode within seven years.  For the past two decades, Ms Brailey, President of BFCSA (Inc), has been a tireless campaigner, championing the cause of older and low income people around the Globe who have fallen victim to banking and finance scams.  She has found that people of all ages are being targeted by Bankers offering faulty lending products. BFCSA warn that anyone who has signed up for one of these financial products, is in grave danger of losing their home.

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BFCSA: How many Investors "borrowed" money from their homes to throw on the Forestry Bonfire?

Posted by on in ROYAL COMMISSION URGENT
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Some of these Managed Investment Scams would have had what appeared to be the ASIC seal of approval: AFSL or Australian Financial Services Licence. 

Some had staff with ASIC approved qualifications as well e.g. RG46.

Yes, I've dealt with one of those qualified slick investment salesmen - they were still slick salesmen, nothing changed with the training.
Some Financial Planners may have had licences, although the ABC program said they didn't.

ASIC tells consumers to look for the AFSL, which implies that these companies are better than the others without the ASIC qualification.
All these licences should mean there's an insurance cover or a representative body with insurance for mistakes made by the holders. But are these insurances sufficient to cover the losses? Are they like the FOS situation, limited on payouts?

This whole area of financial consumer protection needs a really good going through so in future consumers (and financial consultants) can evaluate their investment risk with greater accuracy.

As for disclosure, if the company doesn't disclose accurate information what recourse do investors have? Liquidation of the directors' assets? That's a drop in the ocean for some of these failed investment scams. And directors have clever legal and financial advisers so all they "own" is a set of golf clubs (like a well known Australian involved in the CSI arbitrage case.)

And how many of these investors borrowed money to invest?  What profit did the banks make again from dodgy schemes and more dodgy lending?  Great Southern, Timbercorp et al.

In the meantime don't invest in Australian companies unless you run them yourself - demand a Royal Commission so everyone knows where they stand with ASIC and investment risk.

Roll on the Royal Commission asap - let's get the truth out of ASIC, Government, Ministers and company officials. 

Back to collecting jam tins for the back yard investment scheme ... at least that's on the straight and narrow!

 

This comment from Lisa needed to be blogged......

 

LisaMartin - Posted on Thursday, July 18, 2013

In the program there was mention of both governments needing to take some responsibility for this mess. I agree. The only way to get Government to do this is to make them pay for some part of the clean up. If the director can mount a spirited defense then the same director has something to defend and the money to do it. Those responsible for the incorrect information being disclosed and other misconducts should contribute to the clean up. ASIC Inc should as well. And Australia Inc. In theory that means tax payers shouldn't have to pay for it - unless we are actually assets of Australia Inc...?
This way every defrauded investors should be fully compensated - no more of this partial compensation, token amounts, no liability contributions, and all the other legal nonsense. Pure and simple, those who injure others and break the law must pay compensation to the full extent of the Law. It's up to the judiciary to get on board with this important aspect of fair dealing in Australian justice.
The same principle should also apply to the Banks. It's not acceptable for the Australian government to offer licenses to more Banks and cultivate their business as they did in the 80s and 90s, deregulate the system, fail to provide consumer protection, and then sit on their hands while borrowers slug it out against the might of those same Banks for an unfair outcome with the playing field stacked in favour of the bullies. Government contribution towards FOS, COSL and ASIC "consumer services" doesn't even come close to a cost that might make government and bureaucrats more careful and responsible next time someone has a bright idea. The amount that it costs Government should have some 'ouch' factor in it. Who knows, they may even massively upgrade the Banking and Finance regulatory system, finance a real consumer protection authority and hold a Royal Commission into Banking and Finance to get to the bottom of the Loan Fraud abyss! So always ask for more, even if those at the front line tell you it's not within their jurisdiction. Don't let the criminals or their mates get away with second class justice and half baked compensation deals.
We owe it to ourselves to ensure that we receive everything we're legally entitled to. Just how we do that under the present system and without the money to get out of debt is yet to be discovered.

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