Storm Financial founders experience memory loss in court
Storm Financial co-founders Emmanuel and Julie Cassimatis seemed to be suffering from a bout of absent mindedness in the final days of hearings into the company’s collapse.
Media reports have detailed how Mr Cassimatis declared nearly 50 times that he could not recall details of a meeting with insolvency specialist Ivor Worrell in mid to late December 2008, when the company was on the brink of collapse.
According to The Age, he said he had a vague recollection that the company “was okay” at that stage, and that they had discussed solvency in general terms. A few weeks later Storm went into voluntary administration and was wound up in March owing $80 million.
It was also revealed in court that Storm’s research arm, Ignite, whose software was unable to pick up on the fact that clients were experiencing margin calls, instead arranged a lease on a $7 million private jet. When asked if it would have been more advantageous to invest the money where it was needed in upgrading the Ignite software, Mr Cassimatis said, "No … It's been a long-term goal of mine to acquire a jet".
In a separate media report by The New Lawyer, Mrs Cassimatis denied she had ever received an email from the company’s chief financial officer that stated that a $2 million cash “dividend” the couple withdrew from the company was not allowed as the company was facing insolvency, with $11 million owed to the Australian Taxation Office. They claimed they intended using the money to fund action against the Commonwealth Bank in aid of their clients. This was around the time Mr Cassimatis had discussions with the insolvency specialists, the paper stated.
The Age also detailed that the Cassimatis’ had sent letters to the Queensland and Australian Governments requesting financial support, which stated that Storm’s balance sheet was “not sufficient” to assist clients with further capital. Mr Cassimatis said he may well have drafted the letters but added, “It doesn’t mean I remember it now".
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