Planner and client groups merge to pursue Westpoint

The financial planner led Westpoint Recovery Group and the Westpoint Investors Group have merged in an effort to pursue the negligent parties, and reclaim some of the funds lost, in the Westpoint property scandal.

The merger follows confirmation from litigation funder IMF yesterday that it was initiating actions against two large financial planning firms on behalf of investors which it hoped to finalise over the next two weeks. Hugh McLernon, IMF executive director, said he did not think any members of the Westpoint Investors Group were involved in the action. The Westpoint Investor Group and Westpoint Recovery Group will represent the interests of 1,100 investors in Westpoint who have lost an estimated $150 million. The merged group is in the process of appointing a legal firm to pursue the case, which will, in the most part, be funded by the financial planners on behalf of their clients. The Westpoint Investors Group (WIG), the majority of which invested in Westpoint directly, voted unanimously to merge with the Westpoint Recovery Group (WRG) in a meeting in Sydney last week. The merger is expected to see legal costs for investors that did not have a financial planner drop to a few hundred dollars. “We’re asking them to contact their advisers and ask if they’re part of the Westpoint Recovery Group,” a board member of WRG said. The merger will not stop WIG members pursuing cases against their financial planner, if they believe they have been given negligent advice. However, WIG members will have to wait until the results of the combined WRG and WIG case are decided before pursuing individual actions. The WIG was part of a demonstration against ASIC on Friday last week, in both Sydney and Brisbane, under the banner Australians Scammed by Investment Con Artists (ASICA). Graham MacAuley, president of WIG, has also written to Prime Minister Howard, requesting a Royal Commission into ASIC.