Thanks for that I will have a read..
Navra Legal Action
- Thread starter Mark C
- Start date
Thanks for that I will have a read..
Navra Legal Action RBS
Update on the legal action being taken by Shine. See attached PDF.
I remember at the time being told by a Navra client that "Warrants where a type of insurance". I don't remember anyone saying they where a high risk strategy.
I have posted in the past about not using brokers as I believe you can get better value and structure doing it yourself, in this case I could have expanded my rhetoric to include (some) Financial Advisors.
Mark
Update on the legal action being taken by Shine. See attached PDF.
I remember at the time being told by a Navra client that "Warrants where a type of insurance". I don't remember anyone saying they where a high risk strategy.
I have posted in the past about not using brokers as I believe you can get better value and structure doing it yourself, in this case I could have expanded my rhetoric to include (some) Financial Advisors.
Mark
Navra GS clients
I know a number of forum members whom discovered Navra through this forum and are caught up in the continuing saga and devastation Navra advice has caused. So I will continue to put updates as I come across them.
The recent Great Southern court findings has catastrophic outcomes for many GS investors (I know only a small number 200-300 where Navra clients but worth posting under this thread). However there may be some late developments see attached article from "The Australian".
As one former client emailed to me on the weekend "We can't believe this is happening, almost at the 12hr...... I really don't want to bankrupt".
I know a number of forum members whom discovered Navra through this forum and are caught up in the continuing saga and devastation Navra advice has caused. So I will continue to put updates as I come across them.
The recent Great Southern court findings has catastrophic outcomes for many GS investors (I know only a small number 200-300 where Navra clients but worth posting under this thread). However there may be some late developments see attached article from "The Australian".
As one former client emailed to me on the weekend "We can't believe this is happening, almost at the 12hr...... I really don't want to bankrupt".
Attachments
A lot of people are in some serious trouble if they end up being forced to pay back what Bendigo Bank are demanding. Turned out that Great Southern was just one giant Ponzi Scheme.
I dont know the details of the story but to go into an ivnestment scheme and losing most of your money is one thing, but losing all of it plus owe more even after selling your house is terrible
If that happened to me, id be completely devastated.
no way I could recover
If that happened to me, id be completely devastated.
no way I could recover
Last edited by a moderator:
Sim
Administrator
Unfortunately I think that is not just rhetoric - from my understanding of what was happening behind the scenes with Great Southern (which only became apparent after the collapse), it literally was one giant Ponzi Scheme - an almost textbook case of one
What's worse, it was a scheme which was actively "encouraged" by the government through tax breaks and incentives and product rulings and such.
In many ways, I believe the government is complicit in the failure (on multiple factors) and they should definitely be stepping in to help clean up this mess that they helped create.
We're not talking about large institutions here - we're talking about mum and dad investors who were actively swindled out of their money by a government endorsed investment scheme which turned out to be nothing but a fraud.
To make matters worse, I believe that the conduct of some of the banks in the fallout since collapse has been completely unconscionable.
A very sad situation all round.
Quite. Bendigo are standing tall, trying very hard to make it look like everything they did is above board (lol). Community Bank eh? If they are a community bank, then that is a community I don't want to be a part of!
ANZ, it appears, with much pressure are acquiescing to Timbercorp investors by offering reduced repayments (I think last I heard it was 85 cents in the dollar). They might be lucky to even get that.
How the banks can be allowed to go after investors that were told that the only security for the loan was the trees/whatever else (which turned out to be a lie) and are now worthless is just ridiculous to me.
When you say "the government" should be stepping in, you are saying that taxpayers should be footing the bill for the poor judgment of investors. There are many government policies which encourage investment in property, following which some people have invested in risky mining towns that busted, should taxpayers be paying for their mistakes too?
While it's sad that investors lost their money in this scheme, I find it offensive that you (and anyone else that says these investors should be 'bailed out') think I should have to pay for it.
According to this article over 70% of the customers earn over $250k per year: http://www.theaustralian.com.au/bus...southern-debtors/story-e6frg9lo-1227020392372 Would be interesting to know what the average outstanding balance is rather than these individual stories that would be cherry picked for the hardest hitting media story...
If government is to step in and do anything, it should only be to ensure that those running the "ponzi scheme" have been appropriately punished (how many of the directors went to jail?).
Was Navra an active investor himself? O was he merely living off investors?
Steve invested quite heavily in the products himself.
Sim
Administrator
His debts relating to Great Southern was the primary reason that Steve Navra declared personal bankruptcy. Of course, there were no doubt other factors at play as well.
Sim
Administrator
I think there is a difference between risks which didn't pay off versus criminal fraud - which is what I assert has happened with Great Southern.
I find it disappointing that the attitude of some people is that tax payers money is something you personally have to pay for.
Yes, you pay taxes - but (unlike some recent government policies), it's not a bill you directly pay - there is a very large pool of tax collected from a large number of sources. Some of that money gets spent on policies and programs which either don't directly benefit the Australian population or are arguably used to fund things which we might believe are inappropriate, unnecessary or even outright absurd.
Funding compensation for people who genuinely deserve it will not have a noticable impact on your pocket or quality of life. I think the "I don't want to pay for it" argument is a bit disingenuous and completely lacking in empathy for what is actually happening.
In my mind these people have been victims of a crime (one made far worse by the actions of the banks after the event). The problem is that it is not being treated as such - and thus there is no clear avenue for compensation.
While I am a strong believer in people taking responsibility for their own actions - especially when it comes to investment decisions - I also believe that for the average investor, we should be striving to provide a level-playing field where all the players are playing by the same rules - and I don't believe that has happened in this case.
This is one of the most frustrating things about it - there doesn't seem to be any reckoning for the people behind the failed scheme - at least not that I've seen.
Sim
I think it's a bit of a stretch to say the government is complicit in this . They set the ground rules for any business / investment structure , then it's up to the individuals to make decisions.
eg Negative gearing . Someone buys a property while the aim of negative gearing it while they benefit from capital growth , but if the value doesn't go up , they loose money . Does that make the government responsible because they made it more attractive to invest in something that otherwise would not be profitable .
A investment should be inherently sound , and any tax benefits should be an added bonus , not the rational for the investment.
Cliff
Then those assertions should be followed through by pursuing criminal charges against the perpetrators, not socialising investor losses on tax payers.
It is (but obviously not all of it).
Correct! But two wrongs don't make a right.
If I had my way government would be much smaller & pay for a lot less.
Many of the investors in these plantation schemes invested to reduce the taxes they pay (and some received substantial benefits as a result of this before it all collapsed), now you want those who contribute to tax collections to fund their bailout. Ironic.
I do think that regulation (for a level playing field) is important, but it's never going to be perfect and don't see it as the responsibility of tax payers to bailout those who've blown their dough.
If there are criminal elements at play then they should be investigated and addressed, not assumed, with the costs then worn by unrelated parties.
Sim
Administrator
Yeah, probably is a bit of a stretch.
But my point is that this wasn't just shares or property - it was a managed investment scheme which had to receive regulatory approval before it was offered to retail investors.
I only suggested complicity because I see it as a massive regulatory failure.
The managers of the scheme were using capital from new investors to pay returns to existing investors - which is by very definition, a ponzi scheme.
A lot of people invested in the scheme because of the published past performance results - which it turns out were fraudulently obtained.
The whole thing wouldn't have gotten off the ground without the massive tax incentives offered by the government - which gives people the impression tha the government has done its research and is satisfied that the scheme is legitimate and that it operates within the regulatory framework that we expect it to.
Unfortunately, this is the prime reason so many people got caught up in this - I know that Navra were primarily suggesting Great Southern to their clients for the tax benefits.
I attended a couple of presentations, but I couldn't see the investment benefits - not with a 20 year timeframe to get your returns.
I'm not against using tax benefits to encourage certain types of investment which are seen to be in the national interest. But I think there needs to be some careful oversight about how those benefits operate, since it is - as hobo-jo asserts - public money being used to incentivise such investments.
But , do you want the government watching the day to day management of every such investment scheme in Australia ?
That's unrealistic . Another layer of government oversight and EXPENSE . One does have to wonder what the Auditors of the company were doing ......
There will always be situations like this . It comes down to human nature , but if you seek to regulate for the very small minority , you will make business much harder for the majority . We're already living in a nanny state .
The most important thing they need is a massive stick for those who do the wrong thing . Throw them in jail for 15 years as though they've done a serious armed robbery . In the over all context , they are doing more damage in society than an armed robber who holds up one bank.
Cliff
Sim
Administrator
No need for another layer.
Between ASIC (because MIS), APRA (because loans) and the ATO (because tax) - I think we should have stuff like this well and truly covered.
Yes
Agree completely.
This is the punishment in real life. I followed the guy's advice and lost $50k. He was fined $10k with a $2k good behaviour bond and is now giving financial advice again.
From 2002:
http://www.moneymanagement.com.au/news/financial-planning/archive/wattle-scheme-adviser-faces-court
From 2002:
http://www.moneymanagement.com.au/news/financial-planning/archive/wattle-scheme-adviser-faces-court
[emphasis added]
Personal bankruptcy.....
Like most people smart enough to turn someone else's dollar into many more of their own, I wonder if he used a FT....
And I will just add, before I crawl back under my self-imposed rock (where I am happier / save for the occasional RIP thread) that when it comes to Financial Advisers, this is what I have learned -
If you are going to use a Financial Adviser (and on this forum people need to accept that they are in the minority - a lot of people out there do want a FA - they don't necessarily need one, but they want one) - then, imo, use one that is attached to a major bank.
Adviser X and Adviser Y who are "smarter than your average bear" and run their own little firms - yeah that's all good and well - but if the ***** hits the fan - who is standing behind them? No-one, that's who (certainly not their FT or other vehicle of choice for putting their personal assets at arms length).
At least if you use a major bank you pretty much know that if your adviser does turn out to be a rotten egg (and the chance of that happening in a large bank are greatly reduced) that the bank will basically step in and make it good - lest they be fodder for the 7pm current affairs programs on TV.
Disclaimer - Since left the industry (never again btw), but for 4 years a Senior Financial Adviser with a major bank. Yeah, the investments went up and down with the markets, but I can still walk down the main street where I live. A lot of "independent" FAs that I know can't.
