Financial Standard Comments - FOFA misses the mark on investment fraud A finance industry lawyer has warned that the FOFA regulations will not prevent Trio, Storm and Westpoint-type disasters from occuring in the future. https://www.financialstandard.com.au/feed/latest?story=12915754 Fri, 18 May 2012 14:54:58 +1000 Fri, 18 May 2012 14:54:58 +1000 en-AU Copyright 2026 Financial Standard 5 Comment by Financial Ninja () This is the first intelligent comment on FOFA I have seen.
In fact, Storm was 'fee for service' - there were no commisiions to advisers, just a dollar figure also expressed in percentage terms. As mentioned in the article, everything was explained in an SOA with the client's initial on each page to say they had read and understood that page!
They used plain old Index Funds and margin lending at no greater than 60% with cash buffers. Unless ASIC can guard against 50% drops in the market before a crash, I don't know how they can stop another Storm.

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]]> Financial Ninja () Fri, 18 May 2012 14:54:58 +1000