ASIC settles another Storm case
The financial services regulator has reached a $1.1 million out of court settlement with Bank of Queensland (BOQ), Senrac and Macquarie Bank in a high-profile Storm Financial case.
The Australian Securities and Investments Commission (ASIC) settled the case on behalf of Barry and Deanna Doyle, who will be fully compensated for their losses by the three banks.
"The proceedings, which ASIC commenced in December 2010, were brought to hold the banks accountable for their role in the losses suffered by those who invested through Storm and to establish a basis upon which the Doyles, and ultimately other Storm investors, could achieve fair and adequate compensation," said ASIC Chairman Greg Medcraft.
A three-week trial is due to commence on 3 June, 2013.
Medcraft added: "I am pleased that ASIC has been able to achieve this result and that the allegations against BOQ and Macquarie of breach of contract, unconscionable conduct and liability as linked credit providers of Storm, which were first raised in these proceedings, have provided a template for similar allegations that have been raised in class actions brought on behalf of investors against BOQ, Macquarie and CBA."
The regulator pointed to a similar claim made in the Richards class action against Macquarie, where solicitors of Levitt Robinson and the bank negotiated that approximately 70 per cent of class action members would recover about 18 per cent of their lost ‘net equity'.
"ASIC has appealed the Federal Court's approval of the Richards class action settlement," the regulator said in a statement.
"ASIC's appeal raises the question whether the class action settlement was unfair to the 70 per cent of class action members who did not, or were unable to, contribute to the funding of the action."
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