ASIC applies to wind up Storm Financial
The Australian Securities and Investments Commission (ASIC) has applied to the Federal Court to place failed financial planning group Storm Financial into liquidation, spelling the end of the embattled group.
A statement from ASIC said it believes winding up Storm "will be in the best interests of creditors and retail investors".
The regulator said its application to wind the group up was prompted by a memo published earlier this week on the Cassimatis’ personal website, which ASIC said was "misleading".
The regulator said the information related to the Deed of Company Arrangement (DOCA) proposed by the group's founders - Emmanuel and Julie Cassimatis - which they hoped would keep Storm alive in some form.
The DOCA proposed by the Cassimatis' left scope for potential future litigation by Storm, as well as releases of liability of the directors of the group, the regulator said.
ASIC said its application raises the issue of whether "the DOCA is so flawed that it could ever be in the interests of creditors", and whether creditors could have been expected to make an informed choice about the DOCA.
The regulator also said it is "assessing steps that could be taken against others who might have been involved" in the collapse of Storm Financial, including the group's financiers.
ASIC is continuing to investigate the circumstances around Storm's collapse, including possible actions around the company, its directors and officers. The regulator said "all such interventions", including any against other parties involved in the debacle, would remain available following the winding up of the group.
The meeting of the creditors of the group has now been adjourned to March 30, while the Federal Court has fixed ASIC’s application for a full hearing for March 24, the regulator said.
Recommended for you
Licensee Centrepoint Alliance has completed the acquisition of Brighter Super’s annual review service advice book, via Financial Advice Matters.
ASIC has launched court proceedings against the responsible entity of three managed investment schemes with around 600 retail investors.
There is a gap in the market for Australian advisers to help individuals with succession planning as the country has been noted by Capital Group for being overly “hands off” around inheritances.
ASIC has cancelled the AFSL of an advice firm associated with Shield and First Guardian collapses, and permanently banned its responsible manager.
