|Be careful out there and see how Thailand regulates these advisers|
The Australian authorities cannot seem to find anything criminal about it. But in 2011 Peter Drake started locking in clients money to his funds for up to five years.
This was two years one fund had already gone belly up and punters were unable to get their money back. First he locked up clients for 3 years then came the four and five year stings.
Amazingly Drake put this down to ‘investor demand’.
But what investor wanted to be locked into such a scheme when Drake’s promises were already being exposed?
The secret was of course was to lure unscrupulous independent financial advisers with heavy cash incentives with huge initial payments.
Either the IFAs completely swallowed Drake’s claims that the LM Managed Performance Fund being sold throughout the Middle East and South East Asia, or they deliberately ignored the danger signals because of their greed.
A more cynical treatment of people’s pensions is hard to find. Many IFAs did not tell their clients what they were doing.
Thus IFAs in Bangkok were buying new condos and cars while signing off their clients’ pensions.
Clearly it did not add up. How could LM offer the highest incentives to IFAs and the highest rates to clients – only by taking in massive amounts of new cash – and Drake says it was not a Ponzi.
Managed performance? LM Managed Performance Fund cash was put into massively overvalued property in Australia.
|To flog the LM funds local financial advisers in Thailand also bought or
managed to convince local publications (not hard) to run with glowing
stories about LM.
Continuing Martyn Terpilowski’s revelations:
From: ”LM Investment Management Ltd” <firstname.lastname@example.org>
Date: 1 November 2011 14:38:29 GMT+08:00
Subject: Formal Rates for 1 to 5 Year Terms in LMs Conservative and Enhanced Income Funds
1 November 2011
For Distribution Through Advisers / Intermediaries Only
Rates NOW Available for 1 to 5 Year Terms in the LM Managed Performance Fund and the LM Australian Income Fund – Currency Protected.
To meet current investor demand for longer term, consistent income we have formally introduced rates for four (4) and five (5) year investment terms in the LM Managed Performance Fund and the LM Australian Income Fund – Currency Protected.
Both Funds invest in only Australian assets benefiting from Australian’s stable and resilient economic performance. Whilst the assets of each vest within the Australian property sector, they are different and complementary Funds within an investment portfolio.
The LM Managed Performance Fund and the LM Australian Income Fund – Currency Protected are available for investment in all major currencies across various fixed investment terms, without currency risk. Each Fund has a demonstrated track record for consistently delivering its targeted outperformance of cash rates. Investment rates are not fixed and differ according to the Fund, currency and investment term selected, with longer investment terms attracting slightly higher rates than the shorter terms.
The LM Australian Income Fund – Currency Protected provides conservative income, achieving its performance target of around 2.00%pa to 3.00%pa above official cash rates through its investment in fully secured senior debt positions across the Australian property market. Generally, the debt to security value ratio is around 65.00%.
Following is a snapshot of some of the current rates for the LM Australian Income Fund – Currency Protected.1
1 Year 2 Years 3 Years 4 Years 5 Years
EUR 5.00%pa 5.25%pa 5.50%pa 5.75%pa 6.00%pa
GBP 5.00%pa 5.25%pa 5.50%pa 5.75%pa 6.00%pa
USD 3.25%pa 3.50%pa 3.75%pa 4.00%pa 4.25%pa
Download comprehensive rate sheets for the LM Australian Income Fund – Currency Protected, effective 1 November 2011 here.
The LM Managed Performance Fund provides enhanced income achieving its target performance of around 4.00%pa to 5.00%pa above official cash rates through proactive ownership like positions it takes within the Australian property market. It structures its investment positions as commercial and development loans to ensure all profits are funnelled through the Fund and distributed to investors as income.
Following is a snapshot of some of the current rates for the LM Managed Performance Fund.1
1 Year 2 Years 3 Years 4 Years 5 Years
EUR 6.00%pa 7.00%pa 8.00%pa 8.50%pa 9.00%pa
GBP 6.00%pa 7.00%pa 8.00%pa 8.50%pa 9.00%pa
USD 4.00%pa 5.00%pa 6.00%pa 6.50%pa 7.00%pa
Download comprehensive rate sheets for the LM Managed Performance Fund, effective 1 November 2011 here.
To access all rates, currencies and information on the Funds, please contact your LM Regional Manager or visit the relevant product page on our website.
LM Investment Management Ltd
The global pathway to Australian investment solutions
privacy | contact us
© LM Investment Management Ltd 2011
Responsible Entity & AFSL No. 220281
1 Effective rates are net of 10.00% non-resident withholding tax.
LM is the product issuer, is licensed as a Fund Manager (Responsible Entity in Australia) and not as a provider of financial advice.
Past performance is not a reliable indicator of future performance.
The LM Australian Income Fund – Currency Protected is not a bank deposit and has a different risk profile to cash.
For calculations of interest distribution, please refer to the rate sheets linked in this communication.
From: Martyn Terpilowski
Sent: Wednesday, November 02, 2011 10:01 AM
To: ’Peter Drake’
Cc: ’Shauna Larkin’
Subject: FW: Formal Rates for 1 to 5 Year Terms in LMs Conservative and Enhanced Income Funds
It is absolutely amazing that you can carry on getting away with this, but I presume unscrupulous brokers are only too happy to lock in the client for 5 yrs and take the commission every year when they know clients cannot get their money out anyway… As you know this is currently still being sold as a 1 year product even though my client has been in the ‘queue’ to get his money out for 2 years since his 1 year term ended… so that is 3 years and he thought he was investing for 1 year. Since I realised this I have obviously done no more LM business for investors wanting a 1 year product, but you continue to advertise as such and brokers continue to sell due to your commission levels… the whole thing leaves a very nasty taste in my mouth and the obviously if you get people ‘officially’ locked in for 5, rather than locked in anyway (when they thought it was 1 year) – it takes the heat of you.
I am guessing you indemnify the commissions and pay the full 5 yrs in day 1 also – to keep your ‘best brokers’ happy!!!!!
This fund is closed to redemptions but is still being sold to people as a 1 year product!!!! Do you think this is ethically correct? You hide behind semantics with the story of a ‘queue’ which may be true but reality is if you have people in the queue for 2 yrs plus it is closed and should not be sold… as I have told you before and I am sure you are aware – there are names for schemes like this and they cannot be sold in many regulated locations in the world…
Can I please have an update on [XXXX]‘s money?? He wants it back…. The fact he is still being mailed by Magellan trying to sell him more makes him absolutely furious…as he knows it is all lies, lies and more lies…