'Greatest betrayal since Pearl Harbour': Storm compo deal
LAWYERS for the class action against Storm Financial have labelled a compensation deal "the greatest betrayal since Pearl Harbour" as they launch further legal action.
Sydney-based firm Levitt Robinson made the claim as it filed a case against the Australian Securities and Investment Commission and the Commonwealth Bank, challenging ASIC's integrity as "model litigant" for Storm investors.
The application, which will be heard on Monday, charges ASIC with giving misleading advice to Storm victims that the offer nutted out behind closed doors, and announced last September, was "timely, fair and certain".
Levitt Robinson will make the application on behalf of Brisbane clients Les and Julianne Sherwood, Sunshine Coast clients Sean and Paula McArdle, and other investors with the CBA.
ASIC stated publicly at the time that it "would not have agreed to a settlement unless we thought that that compensation was appropriate".
The Commonwealth Bank settlements, in total, have added up to $268 million.
Class action lawyer Stewart Levitt said ASIC had reneged on its promise to raise the bar for banks by abandoning its court proceedings against the CBA after reaching settlement.
"Because ASIC and CBA used a very convoluted calculation to produce what they say is a 55% compensation offer, it does not uniformly operate as 55% of anything and has an arbitrary effect, benefiting some and penalising others, without reference to the merits of the individual borrower claims," he said.
ASIC has calculated investors, clients of a number of banks, lost about $830 million after Storm's collapse.