Hi All[biggrin]

Its that pesky uninformed dude again.

Some of the funniest arguments were from some dude who had no facts to back his views but tried to shut me up with the line “I’m a fully licensed finacial advisor, so I know these things”…….all he knows is where his commision cheques come from.

1. I know how to spell Financial, you don’t.
2. I work for fee only.
3. You are up to your old trick of insulting people and/or their professions.
4. We the insulted don’t care what you think about us

Perhaps we should widen the area of insulting professionals to include bankers and current banking practices, which may be more amusing to forumites than the drivel starting to appear in this post.
I believe that everyone but bankers would enjoy it[laughing]

Regards
Bryce Inglis
Financial Advisor
[email protected]

Replies on this site are intended as general information only, as any specific investment solutions/advice must only be given in accordance with the requirements set out in the Financial Services Reform Act 2001 and the ASIC guidelines as set out in PS146.An appropriate professional should be consulted for specific advice

Hi All,[biggrin]

ASIC thought something was amiss at Westpoint as early as Feb 2004 but they ran into some jursidiction problems and didn’t/couldn’t do much. Likewise there have benn some other stories recently on how they have ignored or failed to act on companies that looked pretty shady from anyview point.

Nat,

I am puzzled why you have turned into an ASIC basher when during earlier posts on Derivex you enthused about their virtues
As the forums resident bankers advocate and with your level of experience (as you keep reminding us) you should know that ASIC is a Federal body that cannot operate at State level.
ASIC cannot interfere with State legislated direct property issues, and in the case with Westpoint can only act against them if it is proven by the courts that Westpoint operates as a managed property fund which falls under Federal jurisdiction.
This is what ASIC is attempting to do and it is not their fault if Court systems are slow or that errant companies try to delay proceedings further with appeals and challenges. If ASIC are successful with Westpoint in dealing with the current appeal, it will initiate legal action quickly against them.

In short it is none of Asics business but they are trying to make it so, and it is not their fault if State legislation is weak in the areas of consumer protection in regards to property, or come to think of it anything else, and it is not their fault that the main lobbyists to the State governments are the Real Estate Institutes, both at State and National levels who want to preserve the status quo.

This makes me think about how quick and decisive they were to shut down our friends

This is a requirement of the ASIC Act, watch what happens to Westpoint once the legal issues preventing ASIC from acting are sorted out.

ASIC jumped on these guys and stopped them in their tracks within days of the news hitting the street

ASIC have proved once again that they respond quickly to all complaints brought to their attention independently of the outcome.

…which suggests they had an iron-clad case against them …

The above suggests nothing of the sort to someone who doesn’t think like a banker.
There is no iron clad case against Derivex, otherwise it would have been brought to a swift conclusion and this stage has not been reached after over 12 months of deliberation.
The time taken is due in part to Derivex being a new product. This is a process which takes ASIC at least 6 months to do its due diligence and to the difficulty caused by their understanding of all possible facets with the semi-academic explanations given to explain its operations.
This matter is further compounded because ASIC were issued with sequntial complaints (all made before the release of Derivex onto the market).

The only way you could state that Derivex are shut down is if there has been a ruling that no one knows about and that you are the only one with confidential as yet to be released information to the public

Please I await your reply [exhappy]

Regards
Bryce Inglis
Financial Advisor
[email protected]

Replies on this site are intended as general information only, as any specific investment solutions/advice must only be given in accordance with the requirements set out in the Financial Services Reform Act 2001 and the ASIC guidelines as set out in PS146.An appropriate professional should be consulted for specific advice

Hi Redwing[biggrin]

Perhaps we should transfer it to Forum Funnies

PS
love the colors,Red suits you very well

Regards
Bryce Inglis
Financial Advisor
[email protected]

Replies on this site are intended as general information only, as any specific investment solutions/advice must only be given in accordance with the requirements set out in the Financial Services Reform Act 2001 and the ASIC guidelines as set out in PS146.An appropriate professional should be consulted for specific advice

HI Terry[biggrin],

You say that a trust give no added protection. But what if someone is pursued by ASIC for corporations offences and is basically sued? Having their personal assets owned by a trust would surely add extra protection in this case.

Are you discussing a trust that owns assets, or a company owning the assets and the trust owns the company and distributes the profits?

In the Dale Gatherum-Goss Book, Trust magic, the author argues under the section “protecting your wealth” (page 15) that if a trust is sued then the appointer sacks the trustee and appoints a new trustee, the original trustee having lost all his assets, and that “a new trustee has taken control of your assets and they are safely tucked away out of reach”.
On a practical Level if you are pursued by ASIC these antics will only make them more relentless as being the new regulator on the block they are very determined and if anything this can make the penalty more severe.
I know personally know of two cases where one person was a whistleblower and the other was a witness for ASIC, the experience caused both of them to be traumatized (enough for one to leave the industry).
I can only surmise the affect of a person who is defending against an ASIC allegation and it is a position I would not recommend anyone to be in.

In Summary my opinion is that mechanisms to evade the law will not stop legal proceedings by ASIC against all related parties.

Regards
Bryce Inglis
Financial Advisor
[email protected]

Replies on this site are intended as general information only, as any specific investment solutions/advice must only be given in accordance with the requirements set out in the Financial Services Reform Act 2001 and the ASIC guidelines as set out in PS146.An appropriate professional should be consulted for specific advice

Hi All,[biggrin]

Is there a need for a Trust structure?

Addressing the potential of being sued?

It seems a popular ‘fad’ amongst accountants currently to sell a Trust structure on the basis of providing asset protection alone. Since Accountants may not be universally trained, or up to date in commercial law, they often miss what the full legal situation is surrounding Trusts.

The fundamental purpose of a trust, from a legal point of view, is to distribute funds or income held, or received, in trust.

This legal structure was never intended as such, to provide protection from litigation for companies or individuals who may be liable for their actions.

Whilst the CORPORATIONS ACT enshrines the legal notion that a PTY LTD company’s liability is limited to the value of it’s paid up or even nominal capital, plus whatever assets it has, ASIC has been quite rigorous in also defining the duties and responsibilities of directors in the same Act.

If it is clear that a director has acted improperly or irresponsibly or illegally, they also can be pursued as liable, if they have knowingly harboured away the assets of the company over time.

In a situation of sole directorship, the scrutiny of ASIC can also turn to employees of the company who may be complicit in any wrongdoing and receiving of assets from the company.

This makes for a situation where, despite whatever protective procedures may be put in place for assets transferred from the company to individuals, the common legal practice is now to sue both the company and those who had ‘control of it’, who might also be able to be shown, received assets from the company, as a means of avoiding payment of the company debts.

HIH is a good example, even though not a Pty Ltd company, of what happens when ASIC decides to pursue both directors and employees.

However, if an employee, or better still, a sub-contractor of the company, is simply doing their ordinary job and receiving their normal salary, there is NO precedent for them being sued by a creditor or a litigant, unless they personally failed to exercise a duty of care, which then lead to a loss by the litigant.

A Trust therefore gives no added protection in a tort (civil claim for loss or damages through the courts) that can accurately target responsibility under the CORPORATIONS ACT at any individual involved in a company in some way, which may have defrauded or failed in a duty of care to, a client or supplier, or even another employee.

Why TRUSTS are becoming so popular, apart from being cheap and easy for accountants to set up at a profitable price, is because of the (mistaken) belief that a Trust can somehow own or control assets in its own right. That is not true.

A Trust is NOT a legal entity in the sense that it can own anything itself. Only the trustees or members as trustees can legally own the assets of the trust, albeit jointly, on behalf of the members or beneficiaries of the Trust, or a separate Trust as beneficiary, or beneficiary-company.

Trustee Members and beneficiaries can still be individually sued and their assets seized or their share in assets held jointly with others frozen, if they are found liable.

So, what is the upshot of this long description? – Simply that setting up a trust to avoid having your assets attacked would give you no additional security, if you are thought to have been complicit in any illegal activity by the company or any failure of duty of care in a tort.

The fact that a Trust has separated your legal ownership from your beneficial ownership of the assets the company accumulates creates no limitation of personal liability under the law.

You can still end up with a judgement debt against you personally that will defacto force you to re-acquire the legal ownership of those assets from the Trust and sell them, or at least direct your trustee to sell, any assets you may now only hold (beneficially) through the Trust.

The point is, if you are sued successfully, no matter how your assets are ‘protected’ or legally disjoined from you or the company, you will still need to have sufficient capital to avoid going to jail or avoiding bankruptcy and barring from being a company director for five years.

Nevertheless, a trust does let you decide which assets you keep and which you sell, rather than a court or administrator/liquidator making that decision. You decide whether you want the extra expense (probably around $900+) of setting up a Trust which will have you as beneficiaries and the company as the Trustee for the Trust, Trust accordingly, with the investment company becoming the corporate trustee of that asset also.

Regards
Bryce Inglis
Financial Advisor
[email protected]

Replies on this site are intended as general information only, as any specific investment solutions/advice must only be given in accordance with the requirements set out in the Financial Services Reform Act 2001 and the ASIC guidelines as set out in PS146.An appropriate professional should be consulted for specific advice

hi unnanounced[biggrin]

I am just waiting at work for my lovely wife to pick me up so we can celebrate our 6th wedding anaversery at a very expensive resturant. My biggest problem is that I cant spell anaversery.

Regards
Bryce Inglis
Financial Advisor
[email protected]

Hi All,[biggrin]

I’ve taken a while to recontribute to the forum as I was pondering how to get across the point that risk, or even a discussion about it is not negative, but is simply a matter of identifying what the risk is, and by doing so recognize it and be able to take early preemptive action to mitigate or prevent its affects on us.
I felt that the discussion was starting to make me feel negative ( I don’t know how you felt)and that it may possibly be time to talk about the steps to take in order to minimize risk caused by the macro picture , so we may be positive about the outcome and await any event that happens with eagerness. Remember there are only two times to invest, during a bust and during a boom.
We can return to the discussion on other forms of risk later together with identifying signs and what to watch out for. We can also explore defensive measures that can be taken against them.
I started by discussing budgeting, this was followed by a discussion on goal setting. We addressed credit card debt and touched on network marketing as well as interest rates and briefly looked at the international economic picture as presented by the US and Japan. We discussed how markets can sometimes behave irrationality, and even gave a little bit of a history lesson.

I sometimes entertained (hopefully) and sometimes bored people I but have always tried to discuss issues in simple terms so that the newer less sophisticated forumites could understand, as well as realizing that there are differences present in the wide spectrum of readers here on the forum.
So to recap briefly,
Prepare a budget in the usual way, then tear it up and change it from a normal budget into a wealth creation tool. With credit card debt and I address my remarks to those with a balance that never returns to zero. In 2002 we had a credit card debt of $7.3 billion or putting it another way $7,300,000,000.00. Now that looks bigger, there’s a lot of zeros even if I did include the cents.
According to the AMP report just issued “Household debt in Australia” we have an average savings rate of minus 2%.
The link to the report is here
http://www.amp.com.au/group/3column/0,2449,CH5273%255FNI9917%255FSI3,00.html

Goal setting is a necessary to keep focus on our aims. Reward yourself for each step attained. Recording your goals equates to giving your subconscious an instruction, and to carry it out with or without any awareness of the process.
The economy of the US is in poor shape and will implode in the future. The million dollar question is when this will happen; it’s no longer a Question of if. The Japanese (who after their bust are too frightened to spend their way out of it, even 9-10 years later,) are stagnating.

Will this affect the Australian Economy and what will happen here? This is difficult to answer as there are some similarities and some differences, for instance the home mortgage industry in America is controlled by two large companies Fanny Mae and Farmer Mack who between them control 76% of the market.
From Barrons Dictionary of Finance and Investment Terms.
Fannie Mae (Federal National Mortgage Association) publicly owned, government sponsored corporation, is congressionally chartered, share holder owned company and is the largest source of home mortgages in the US

They are set up very differently to our system of banking, in being underwritten by the US government whilst being run as a public company. They are not subject to a regulatory body which limits risk exposure such as the Australian Prudential Regulatory Authority (APRA) http://www.apra.gov.au/ but rather are encouraged to heighten risk (in the interest of shareholders and in particular company directors who hold shares) as the US Government guarantees Fannie Mae against loss. This means the bank can increase return and whilst removing risk from the equation
Another difference is in their size, together they hold about $6,700,000,000,000.00 ($6.7 Trillion) in mortgages. This is in addition to the US Current Account Deficit of $3.7 Trillion. This is a lot of debt.
The situation in Australia is quite different with a large number of competitive providers in the mortgage market all regulated to operate in a prudential manner
Details of the Australian banking industry are found here
http://www.apra.gov.au/Insight/loader.cfm?url=/commonspot/security/getfile.cfm&PageID=8006

Also interest payments on all properties mortgaged in the US are tax deductible, whereas in Australia there are cost penalties on the purchase (stamp duties) and disposal of property (Capital Gains Tax).This tends to make Australian property less liquid than American properties. Australians tend to buy and hold so that property losses on paper are less likely to be realized. This situation does not apply to New Zealand as there less government taxes applied to the buying and selling of properties.
Next time I will discuss loan structures to minimize risk.

Regards
Bryce Inglis
Financial Advisor
[email protected]

Replies on this site are intended as general information only, as any specific investment solutions/advice must only be given in accordance with the requirements set out in the Financial Services Reform Act 2001 and the ASIC guidelines as set out in PS146.An appropriate professional should be consulted for specific advice

Hi all,[santa] [party] [xmas]

I went thru a phase of poverty in life when I was studying financial planning and my wife was finishing her masters. I now work and she is on a PhD scholarship which doesn’t provide a lot of money. During the poverty phase we purchased Christmas decorations during January saving up to 2/3rds of their cost. We store the decorations away in boxes covered in old Christmas wrappings. At Christmas time we store the boxes under the tree whilst the decorations are in use.
We also now make our presents for adult friends and family, consisting of items like home made jams, lemon butter, biscuits, and sweets. These are packaged together as a small hamper and are much appreciated by all.

Merry Christmas to all

Regards
Bryce Inglis
Financial Advisor
[email protected]

Replies on this site are intended as general information only, as any specific investment solutions/advice must only be given in accordance with the requirements set out in the Financial Services Reform Act 2001 and the ASIC guidelines as set out in PS146.An appropriate professional should be consulted for specific advice

Hi All,[biggrin]

A little bored Bryce?
Hi crashy,[biggrin]
I agree and will try and make them shorter. History is dull reading for some people and yet we often use historical data to analyze situations. I also notice that your posts have been less fiery since March. (#;! $# ASIC)

Get a job in a regional centre and your employer will often pay for your accommodation or give you subsidise rent.
Hi lukis p,[biggrin]
Your suggestion is along the theme of using others to subsidise rent or Mortgage payments.
A suggestion previously provided by happy couple[biggrin] uses the same theme.
You could investigate the suitability of purchasing management rights (permanent or holiday) this includes a real-estate component which you can live in or rent out
Another way is to provide board to university students or others.

Just wondered – is anyone here network marketing?

Hi Rose,[biggrin]
We have had some discussion previously on pages 3, 4 and 5 on network marketing with contributions by marc 1, honkeytonk, wow and Y.
I am a member of a couple of organizations but am not active with them.

Regards
Bryce Inglis
Financial Advisor
[email protected]

Replies on this site are intended as general information only, as any specific investment solutions/advice must only be given in accordance with the requirements set out in the Financial Services Reform Act 2001 and the ASIC guidelines as set out in PS146.An appropriate professional should be consulted for specific advice

Hi all,[biggrin]

Why wait for 2006

From the following link

http://www.realestateview.com.au

State of the market
10th November 2004
The latest housing market statistics confirm the end of the housing boom with median house and apartment prices and building approvals in Victoria continuing to decline.

According to the latest REIV figures for the September quarter median house prices are down 1.3 per cent to $366,000, while apartment prices have fallen just 0.7 per cent to $290,000. The figures represent a reduction in median house and apartment prices of 2.4 per cent and 3.3 per cent respectively over the past 12 months.

The regional centres followed the trend with Ballarat’s median price down 1.6 per cent to $190,000, Bendigo down by 2.9 per cent to $203,000, and Geelong down by 2.5 per cent to $275,000.

REIV chief executive Enzo Raimondo said the figures provided further evidence that the residential market had returned to more sustainable growth patterns and had entered a new property cycle.

“We believe price growth and activity levels have bottomed out and, given the current economic environment, we are likely to see a period of stable or minor growth in the foreseeable future after three consecutive quarters of negative growth,’’ he said.

The REIV figures revealed Melbourne’s three most affordable suburbs were St Albans, Meadow Heights, and Hoppers Crossing and most expensive Toorak, Brighton, and Kew.

On building approvals, September quarter figures from the ABS show that, seasonally adjusted, total dwelling unit approvals fell 3.8 per cent to 12,928 nationally, the lowest figure since June 2001. In Victoria there were 3232 dwelling unit approvals for September, a fall of 10.3 per cent from August.

PS Enzo Raimondo always says figures provide further evidence that the Market is recovering blah blah.

Regards
Bryce Inglis
Financial Advisor
[email protected]

Replies on this site are intended as general information only, as any specific investment solutions/advice must only be given in accordance with the requirements set out in the Financial Services Reform Act 2001 and the ASIC guidelines as set out in PS146.An appropriate professional should be consulted for specific advice