|
|
|
|
|
 INVESTING |
|
Smart Investing
ASIC takes action against Westpoint
 November 14, 2007
Robin Bowerman
Most of the distressed investors in the failed Westpoint property group would have experienced extreme feelings of bewilderment and desperation when some or all of their retirement savings were lost. Such feelings would understandably be exasperated by an uncertainty about what steps to take.
The decision by the Australian Securities & Investments Commission (ASIC), announced late last week, to take civil action for damages, for the benefit of investors, against five directors and officers of Westpoint and from the licensees of five financial planning firms should provide some comfort.
Putting aside any questions about whether or not ASIC has acted decisively enough to this point; many investors should be comforted by knowing that ASIC is making a strong stand on their behalf.
Certainly, some valuable lessons about the fundamentals of sound personal investment practices are once again reinforced by the sad Westpoint saga including: Higher potential returns mean higher risks; the value of diversifying investments for risk and return – in other words, the dangers of putting all of your eggs in one basket; and the desirability of investing in accordance with your personal tolerance to risk.
But the discussion of such lessons may ring rather hollow to many of the elderly investors who had been trying to provide for their retirement, taken professional financial planning advice, and who may have little likelihood of achieving investment success in the future given their age.
Many of us have time to learn from our mistakes in order to shape our future approach to investing but for many elderly investors it is just too late.
At this stage, ASIC says it has identified potential claims of up to $245 million that could be claimed for as many as 3600 of the 4300 Westpoint investors. (For a summary of the latest Westpoint action by ASIC see:
ASIC pursue compensation for Westpoint investors
More articles from this edition of CompareShares:
Investing: Going global: investing offshore with global ETFs
Stocks: Stock picks for the long haul - HFA Holdings and Hastie Group
US: Trading the gold stock bull
Rates: Free market curves into danger zone
Markets: Bottom feeding in a panicked US market
Economics: Inflation reading - just hot air?
Smart Investing: ASIC takes action against against Westpoint
Expert Panel (Futures): The SPI as a market predictor
Markets: Mid-week market wrap
Whatever your views, you can discuss this article - or any of Robin's articles - on our message board Your 2 Cents.
Robin Bowerman is Head of Retail at index fund manager Vanguard Investments Australia and the former managing editor of Shares and Personal Investor magazines. To receive this column by email each week go to http://www.vanguard.com.au/ and register with smart investing.
 Email to a friend
 Print this article
|
|
