FX trading gone wrong: Commitment breached

[Bra B]

I transferred some money to a private individual who does FX from home. This person is known to me and he gave me a written IOU for the money received. The agreement was that he would trade with my funds and that I give him notice when I want to withdraw monies from the investment. We met on a regular basis and communicated via email and he gave me the assurance every time that all is going well. I have emails where he indicated the current investment value and it looked good.
I needed some funds now and asked him to transfer it to my account, only to hear that he has been using my investment to live off and that he has no money to pay me back. He admitted in writing (email) that he has been deceiving me the whole time.
I know that this was a stupid move on my part and seek some advice from our forum members, please. Can I open a case of fraud with SAPS or should I ask Legal Aid to assist. I cannot afford a lawyer. No sticks and stones please....i'm hurting already!

 

[maumau]

Ow ow ow ow ow, that's bad. Hope you didn't lose too much

 

[Arthur]

Did he clearly say he'll never pay you back, or just that he can't do so right now? How does that stack up with the written terms of your agreement?

If his email unambiguously says he's deceived you then it might be evidence of fraud, in which case lay a charge at your local SAPS.

 

[Arthur]

Remember, even if he's eventually prosecuted for fraud, that won't get your money back. Criminal cases are between the State and the Accused, and you are only a witness.

Assuming you have a good contract, and can prove it (eg in writing) you'll have to bring a civil action for breach of contract, petitioning either for specific performance or restitution. Either way the chances of full recovery are slim because the court will know that Forex trading is inherently risky and you knew that upfront when entering into the agreement.

 

[Bra B]

Thanks Arthur. He told me he has no money to pay me. The lifeline is an inheritance due to his daughter (aunt passed in NZ earlier this year) and I have an email from his daughter that she will honour the amount owing. I have been told that the legalities around the will have been finalised and that the curator will provide a letter indicating the inheritance amount due to the daughter. This letter is not forthcoming - I want a copy. The IOU indicates a due date when the money is payable and that date expired. The arrangement was to keep the investment going until I need the money.
This is from an email he sent in Aug: "I would like to apologise again for my deception and will do everything possible to rectify this problem asap." My response: "I am concerned that you still quote growth at xx% per month when you are not playing the market and you admitted that you have no funds to play the market. In my opinion you are digging a deeper hole for yourself, my friend. Let's face reality."
I will give him until the end of this month and then follow your advice. Appreciated !

 

[Bra B]

Ow ow ow ow ow, that's bad. Hope you didn't lose too much

Fortunately not. Thanks

 

[Arthur]

If I were you and the sum is more than say R50k I'd relentlessly nag him and possibly insist he surrender to me some security, eg a moveable asset (eg furniture, equipment) with realisable value a little higher than sum owed.

His daughter seems so embarrassed by this that she's prepared to cover for him, which probably shows he's not an absolutely awful human being... In any case he says he'll pay you when he can, so on the face of it he acknowledges the debt and what you're arguing about is the repayment timeframe, which also undercuts any allegation of fraud.

Your chances of recovering via the courts seem vanishingly small, especially since you said "play the market", which is not the language of a bona fide and enforceable agreement. It can be argued that this phrase shows you know it's a gamble.

Either way, get some real legal advice and speak to a lawyer. Make sure you tell them everything and show all correspondence you've had, else they can't give you accurate advice.

 

[Bra B]

Noted. Thanks for your input Arthur

 

[Spliffcat]

Sorry to say. School fees.
I have found the little turd who owes me a lot of money.
He has got nothing.
Maybe extract payment in terms of a knee cap or two.