1 / 16

Investment Scheme

Investment Scheme. Presentation developed to show how a bank should not be held liable for investment decisions made by trust account holders. Click to advance slides. State Bank was not involved in investment advice and/or decisions.

kristopher-tannis
Download Presentation

Investment Scheme

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Investment Scheme Presentation developed to show how a bank should not be held liable for investment decisions made by trust account holders. Click to advance slides. www.executivepresentations.com

  2. State Bank was not involved in investment advice and/or decisions www.executivepresentations.com

  3. State Bank held “directed custodial trust” accounts for the Investment Group... Investors approached Smith and signed documents giving Smith complete control Investors • Investors • Choose to invest in Investment Group • Designated Smith as General Partner

  4. State Bank held “directed custodial trust” accounts for the Investment Group... ...State Bank is involved solely because of type of funds (IRAs, etc.) Investors State Bank $$$ • Investors • Choose to invest in Investment Group • Designated Smith as General Partner • State Bank • Must follow direction of investors • Provides services for a fee, does not profit based on performance • No audit rights

  5. State Bank held “directed custodial trust” accounts for the Investment Group... ...State Bank is involved solely because of type of funds (IRAs, etc.) Investors State Bank Investment Group $$$ $$$ Direction From Investors • Investors • Choose to invest in Investment Group • Designated Smith as General Partner • State Bank • Must follow direction of investors • Provides services for a fee, does not profit based on performance • No audit rights

  6. State Bank held “directed custodial trust” accounts for the Investment Group... ...State Bank gave NO advice or direction as to how the money was invested Investors State Bank Investment Group $$$ Direction From Investors Smith • Investors • Choose to invest in Investment Group • Designated Smith as General Partner • State Bank • Must follow direction of investors • Provides services for a fee, does not profit based on performance • No audit rights • Bob Smith • Squanders $$$ as he sees fit and conceals fraud from everyone

  7. Who are the Plaintiffs? www.executivepresentations.com

  8. Who are the Plaintiffs? • Wealthy individuals who are sophisticated, knowledgeable investors who presumably know how to properly research investments • Business associates and friends of Smith Promises of extremely high investment returns led them to willingly take risks

  9. Who are the Plaintiffs? • Wealthy individuals who are sophisticated, knowledgeable investors who presumably know how to properly research investments • Business associates and friends of Smith • Students of Smith’s Investment Theory Classes Promises of extremely high investment returns led them to willingly take risks Blind belief in Smith and his authority position led to faulty judgment

  10. Who are the Plaintiffs? • Wealthy individuals who are sophisticated, knowledgeable investors who presumably know how to properly research investments • Business associates and friends of Smith • Students of Smith’s Investment Theory Classes Promises of extremely high investment returns led them to willingly take risks Blind belief in Smith and his authority position led to faulty judgment ...The Plaintiffs made their investment decisions for personal reasons, having NOTHING to do with State Bank

  11. How did Plaintiffs make their investment decisions? For whatever reason, the plaintiffs did not follow typical investment practices, and instead blindly followed Bob Smith... www.executivepresentations.com

  12. NO Did the Plantiffs... • Thoroughly research companies/entities

  13. NO Did the Plantiffs... • Thoroughly research companies/entities • Perform Due Diligence regarding personwho is making investments NO

  14. NO Did the Plantiffs... • Thoroughly research companies/entities • Perform Due Diligence regarding person who is making investments • Consider investment strategy — carefully calculating risk and realistic returns NO NO

  15. NO Did the Plantiffs... • Thoroughly research companies/entities • Perform Due Diligence regarding personwho is making investments • Consider investment strategy — carefully calculating risk and realistic returns NO NO ...The Plaintiffs willingly took an enormous and irresponsible risk and are unwilling to accept their own responsibility in the scheme

  16. Who Should Bear the Loss? Irresponsible investors who willingly accepted the risk that Smith would “lose all the money” or trust companies that were providing a legitimate service? ...The Plaintiffs should bear the loss www.executivepresentations.com

More Related