More than two decades after surviving a horrific bicycle accident, Fairy Meadow man John Telford is facing financial ruin and the loss of $600,000 in a failed investment recommended to him by a Wollongong financial planner.
Mr Telford, 62, has had a rough ride since the 1985 accident at Gwynneville, which occurred while he was cycling to the University of Wollongong. Mr Telford was flung from his bike when the driver of a parked car opened a door in front of him on August 6, 1985.
Run over by an oncoming vehicle, he had critical injuries - including a broken back and broken neck - that left him in hospital for nine months.
A year-and-a-half after the accident, Mr Telford returned to university. He completed a Bachelor of Arts and a Masters of Creative Arts.
It took 14 years for Mr Telford - diagnosed as an incomplete quadriplegic - to be awarded a compensation payout and he said it was a condition of the payout that it be invested to provide for his financial security.
When he received the money in 1999, he was warned he would not qualify for a pension until at least 2023.
He said the sad irony was that he had been frugal with his money to ensure it would last and that it would cover his ongoing medical expenses.
Now, much of the money he entrusted to Wollongong financial planning business Tarrants, to manage on his behalf, is feared lost after the collapse of fund manager Trio Capital and its $123 million flagship investment scheme, Astarra Strategic Fund.
Statements provided to Mr Telford by Tarrants indicate the retiree had $49,204 personally invested in Astarra Strategic Fund, and a further $553,000 invested through his superannuation fund, as of June 30.
In addition to the losses, Mr Telford has also been left with margin loans he was advised to take out to finance some of the investments.
Tarrants Wealth Management, the financial planning arm of the business, has now been placed in voluntary liquidation.
A spokesman for Tarrants said the firm would not be commenting on Mr Telford's situation.
Mr Telford admitted he understood little about financial matters, and had placed complete faith in his advisors at Tarrants, including managing director Ross Tarrant.
"You just can't describe the helplessness of having a big amount of money whizzed out from underneath you," Mr Telford said.
"I have been walking around the house like a zombie."
After attending a meeting this week with Mr Tarrant and seven other clients, Mr Telford said he was sympathetic to Mr Tarrant's situation.
"At the meeting, Ross Tarrant was quite commiserate about the effect on everyone. I can't fault him," Mr Telford said.
He believes the ultimate fault in the Trio collapse lies elsewhere and Mr Tarrant's biggest error may have been a failure to "dot the i's and cross the t's".
Mr Tarrant has previously defended his advice to clients to invest in the Astarra Strategic Fund, claiming four-year data showed the fund had significantly less risk and volatility than other offshore funds. He has admitted to accepting an $840,000 marketing allowance from Trio, but said it was only to see his company through the global financial crisis.
Mr Telford meanwhile was "just hoping that law will prevail and they will find the money somewhere".
Trio Capital failed last October, leaving around $180 million in assets that cannot be traced.
A nine-month global hunt has failed to turn up the missing funds, supposedly invested in a complex web of hedge funds in foreign tax havens, including the British Virgin Islands.
The collapse has impacted on hundreds of Illawarra investors who had money invested in Trio and were also clients of Tarrants or another Wollongong adviser, Colin Warne. Wollongong financial planning business Dominion acquired the Trio clients when it bought Warne Financial Services in 2008.
Mr Telford has sought extensive advice from other financial planners, accountants and lawyers about how to restructure what is left of his investments and how to recover the missing funds.
Tarrants is encouraging its clients to join a class action organised by Victorian law firm Macpherson and Kelley against Trio Capital and Mr Telford said he had signed up to join the action.
He is also joining a potential professional negligence case against Tarrants that is being investigated by Maguire and McInerney solicitor Mark McDonald.
"I'm concerned that if I don't pursue legal action I will not get any money," he said.
"But legal action could drag on for years and I don't know if I can afford that."
Email a friend
Favourites
Del.icio.us
Facebook
Digg
StumbleUpon
MySpace
Reddit
Newsvine
LinkedIn
Kwoff
Twitter