Not to rub salt on the wounds of the investors, but due to my curious nature (I am an ardent student of financial bubbles, scams and mania) I just want to ask you SMBeer, what was the motivation for these people you advised to disregard your sensible advice? Was it greed?
Yes, it was partly greed, but it was also ignorance, trust of the salesperson, and being duped by the glitz and glamour of the company. I have been giving finacial advice for over 20 years, but the people I advised not to didn't know me (much, or very long), so why trust someone they don't know more than someone they do know? ...Human nature?
Wow. That's a large liquidation indeed. Even specialists that buy distressed companies' debts are still able to buy them for an 80% discount compared to your assessment of just getting back 1.5%.
My assessment is not related to the distressed company, because that was just a smoke screen. My assessment is based on the possibility (slim I think) of being able to hold sales people accountable, and I would not be surprised if they haven't already, they wil be rapidly transferring their assets into family, friends and untouchable corporations names.
The only way for these to stop is vigorous enforcement of the law and better investor education.
Better education comes when people learn from their mistakes too, I would venture to suggest that there have been a lot of lesson learned here, but then again, there's another expression "There's one born every minute."
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