Opes Prime Bankruptcy

[Garpal Gumnut]

This brokerage to the "sophisticated investor" has gone bottoms up on Friday 28th March.

There may be a large sell down of susceptible shares held by these investors tomorrow Monday.

Apparently those who borrowed to leverage into shares other brokers would not offer, did so, at the expense of signing beneficial ownership to OPES Prime's bankers.

Those bankers, ANZ and Merrill Lynch are now calling those loans in and on friday liquidated many portfolios.

Interesting times.

gg

 

[rub92me]

If they liquidated on Friday, wouldn't it mean that they already sold on Friday? For some stocks it looks like there was already quite a big (forced) sell off. Maybe more to come though...

 

[Sprinter79]

Opes Prime used to be my favourite Transformer hahaha.

 

[Markcoinoz]

If they liquidated on Friday, wouldn't it mean that they already sold on Friday? For some stocks it looks like there was already quite a big (forced) sell off. Maybe more to come though...

I know there were some big ones that went through with ADY and BMN after the bell on Friday.

However, i think there is alot more to come tomorrow and throughout the week as they unleash them onto the market.

Glad to be a spectator.

It serves as a reminder to read the fine print especially when dealing with any form of Margin Lending or CFDs.


Cheers markcoinoz

 

[2020hindsight]

heard someone referring to today as Opus Day

PS Margin lending has gotta be playing with fire surely - specially in these uncertain times.

 

[2020hindsight]

http://www.abc.net.au/pm/content/2008/s2202228.htm

Opes Prime suspended from ASX trading PRINT FRIENDLY EMAIL STORY
PM - Friday, 28 March , 2008 18:56:00
Reporter: Brigid Glanville
LISA MILLAR: And now for our look at today's business and finance, here's Brigid Glanville.

BRIGID GLANVILLE: The Australian Securities and Investments Commission has begun an investigation into the stockbroking firm Opus Prime.

ASIC says it's formed a special team to investigate possible breaches of the Corporations Act.

A receiver and an administrator were appointed last night after cash and stock movement irregularities were detected on a small number of accounts.

All client accounts have now been frozen.

It's unclear at this stage how many clients are affected.

Opus Prime has also been suspended from trading on the Australian Stock Exchange.

meanwhile, "James Packer's personal wealth dropped 3.6 per cent to just over $5 billion" poor buga!

Twiggy moves to uncontested first place .. 6.6 bill

Andew Forrest, founder of Fortescue Metals Group has surpassed James Packer as Australia's richest man on Forbes' Asia's rich list.

Andrew "Twiggy" Forrest has a fortune estimated at $6.6 billion.

In Forbes list of Australia and New Zealand's wealthiest people. James Packer's personal wealth dropped 3.6 per cent to just over $5 billion.

The news of Andrew Forrest's wealth didn't help its share price today. FMG fell 4.5 per cent to $6.58.

The ASX200 was down 20 points to 5,351... etc

http://business.theage.com.au/opes-money-trail-warms-up/20080331-22os.html

While co-lender to Opes, Merrill Lynch is the culprit behind the stock dumping last Friday, things could turn tricky for ANZ.

 

[metric]

'Market genius' loses $140m in Opes Prime collapseBy Chris Merritt and John Lyons


April 01, 2008 02:59am


Market king's fortune wiped out by Opes collapse
Highest profile victim of share market shake-out
Lays blame on ANZ

CHRIS Murphy, the lawyer who won big on the horses and was reputed to be a high-rolling gambling associate of the late Kerry Packer, has taken a massive tumble.

His $100 million-plus share portfolio has been wiped out in the collapse of Melbourne-based stockbroker Opes Prime, making him the highest-profile victim of the escalating sharemarket shake-out.

Mr Murphy has decided not to litigate. Instead, at the age of 60, he is pondering how to put the disaster behind him and rebuild a future for his wife and two young children.

It is a big come-down for Mr Murphy, who is widely connected




http://www.news.com.au/business/story/0,23636,23463029-14334,00.html

 

[Kauri]

and I found it slightly worrying that the principal of Opes goes by the name Laurie Emini..
Cheers
.........Kauri

 

[Trembling Hand]

and I found it slightly worrying that the principal of Opes goes by the name Laurie Emini..
Cheers
.........Kauri

Yes I love his name. Same name that the spruikers use to describe futures as they rip off the unaware punter!!

 

[Bill M]

"THE head of the collapsed stockbroking firm Opes Prime, Lirim "Laurie" Emini, told his staff to falsify the accounts of six rich clients, covering them for personal losses of up to $200 million as the value of their share portfolios plunged, a court has been told."

Full Story Here

 

[grace]

700 stocks held by Opes Prime. Isn't there only 3000 listed on the ASX? I note the report is dated 2/4/08 - April fool

http://www.news.com.au/heraldsun/story/0,21985,23468119-664,00.html

I own a few listed there. Hard to escape it really. Merryl have done all of their selling and ANZ only 27% thus far....

 

[Wysiwyg]

"THE head of the collapsed stockbroking firm Opes Prime, Lirim "Laurie" Emini, told his staff to falsify the accounts of six rich clients, covering them for personal losses of up to $200 million as the value of their share portfolios plunged, a court has been told."

Full Story Here

What of the innocent victims with less financial interest in comparison(but alot to them personally)?This stuff is what makes people lose faith in humanity and never trust again along with many other acts of betrayal of trust in life.

 

[bliimp]

In today's Age newspaper, at last, a bit of information for Trader Dealer clients, who have had their trading accounts frustratingly frozen since last Friday, with zero communication, while the main game with Opes and is margin lending saga continues to play out!!!

..... a consortium was finalising a deal to salvage Opes Prime Group's online trading system, Trader Dealer.

Deloitte partner Chris Campbell, one of two receivers and managers to Opes Prime, said the administrators at Ferrier Hodgson were approached with an offer on Friday.

And in yesterday's 11-page circular to Opes Prime clients, Deloitte confirmed that ANZ did not have security over Trader Dealer. The consortium was expected to waste little time in getting Trader Dealer operating again.

The situation is less clear cut for Opes Prime clients, and companies affected by the group's collapse.

 

[dregen]

What of the innocent victims with less financial interest in comparison(but alot to them personally)?

http://www.marcustoday.com.au/webpages/234_opes-letter.php

 

[Bill M]

http://www.marcustoday.com.au/webpages/234_opes-letter.php

Some terrible, painful stories there and it needs to get sorted out by the regulators. People losing their life savings through no fault of their own, it is just so pathetic that we don't have laws and systems to protect these people. Where are the regulators and what are they doing about it?

 

[Aussiejeff]

Some terrible, painful stories there and it needs to get sorted out by the regulators. People losing their life savings through no fault of their own, it is just so pathetic that we don't have laws and systems to protect these people. Where are the regulators and what are they doing about it?

These days, governments can avoid having to pay for setting up any regulatory controls simply by offering the point "buyers/consumers beware" in relation to any transaction involving money.

Maybe more effort should be made in schooling to hammer into peoples heads that ALL transactions involve SOME degree of risk. We in the forum are probably better aware of this than your average Joe Blow (oops - sorry Mr Moderator Joe, Sir - I didn't mean YOU - lol) but there would seem to be a lack of general public knowledge of how RISKY things can be in the finance/business world.

Still, the horse has now bolted and given the current fiascos, it obviously wouldn't hurt for some better basic regulatory guidelines or rules be set up by the Fed government to significantly punish purposeful mis-information or deception by company execs etc. Their family assets should be seized as for any criminal gang etc IMO. Jail terms should be increased markedly. That might just put the dampers on some of the cowboys out there currently rubbing their golden hands with glee....

AJ

 

[Julia]

AJ, you're right in suggesting that too few people are sufficiently cautious about risk. But they can't be expected to allow for illegal manipulation and fraudulent record keeping etc. (That's a general remark and not specifically directed towards the current Opes mess).

About ten years ago, following talking with satisfied clients of a solicitor's private mortgage scheme, I put some funds into a specific commercial project with that scheme. The documentation was very detailed, with extensive valuation reports on the project (conversion of an existing commercial building) from a well known registered valuer, and an LVR of 60%.
All went well, the interest payments (above bank interest by about 3%) came in regularly and the capital was repaid on completion of the project.
So I re-placed the funds on a further project. Hah, not so damn lucky this time. It turned out the valuation was hugely inflated, and some of the investors' funds had been siphoned off and put into yet another failed project.
Eventually, after much screaming for many months from furious investors, ASIC deigned to do some desultory investigations. This took more months.
They conceded there was a problem. Liquidators were appointed. The solicitor was barred from practising and his passport removed from him.
The upshot? The liquidators managed to spin their investigations out for more than two years, and by the time they had extracted their fees (taken from the sale of the overvalued buildings), the investors received approximately 8 percent of their original capital. Eventually a case was brought against the solicitor, but he didn't go to jail.

So, I have very little faith in the regulatory authorities.

 

[cuttlefish]

700 stocks held by Opes Prime. Isn't there only 3000 listed on the ASX? I note the report is dated 2/4/08 - April fool

http://www.news.com.au/heraldsun/story/0,21985,23468119-664,00.html

I own a few listed there. Hard to escape it really. Merryl have done all of their selling and ANZ only 27% thus far....

So given that Opes prime is the broker to 'sophisticated' investors and company directors - should we be even more worried if we hold stocks that aren't on that list? Is a stock a dud if not a single opes prime client held any?

 

[marklar]

Some terrible, painful stories there and it needs to get sorted out by the regulators. People losing their life savings through no fault of their own, it is just so pathetic that we don't have laws and systems to protect these people. Where are the regulators and what are they doing about it?

Now everything is gone. $400K worth of life savings. I checked our bank account yesterday and our total net worth is now $4,920.46. That is a big full stop after the zero. There is no investment property, there is no cash investment account. There is nothing left. We are a family who could only ever consider public schooling to begin with.

If ever there was an abject lesson about diversification, that surely is it.

I feel sorry for these people that have invested such a significant chunk of their savings into an investment vehicle that they
a) really didn't understand
or
b) got in to based on someone elses' advice

I've probably spent countless hours investigating investments that haven't panned out, but I can't possibly imagine plonking down $400k of my hard earned without understanding all the risks.

m.

 

[sails]

It almost seems that diversification might not only need to be spread across investments, but also brokers, margin lenders, etc.

I guess the other reminder in this is to carefully read the fine print - or pay for a legal eagle to point out where the risks are before signing on the dotted line.