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Useless broker

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Contributor
Guys, help... I have contacted "a leading company" to manage some funds of mine. They invested via CFD's. From 120k, my account is now worth about 10k. Is there any recourse I can take for the poor management of funds?
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13 REPLIES 13
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Frequent Contributor
did u read the fine print ?
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Super Contributor
You say "investing in CFDs", you don't invest in CFDs, you trade, and if you don't know what you're doing, it's gambling. Rather expensive school fees I'd say.
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Not applicable
was it with Doc Roffey?
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Not applicable
I hate to say it mate, but your recourse is minimal. You can approach the financial services board, since they will need to have a license to manage your funds - I think. But if they are licensed, then they would have had to disclose some sort of a methodology to you. If they did this, and you have it in writing, and they didn't stick to it, and you can prove that, then you might have some sort of claim against them (but it will be a high court matter, will take years, and will probably cost you around R250k in legal fees, which you will probably have a claim for recovery). If they did stick to the methodology, or they didn't tell you what it was, then, I as much as I hate to say this, the fault is primarily yours for not doing your homework. There is also the consumer protection act, but I know very little about this ...
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Super Contributor
if your money was used to trade for you, you have no recourse. But how do you know that your money was not "stolen" from your account for other things....but long and short is you have NO recourse...Mr Brown(no , the Arthur fellow), just proved that. Lessons: stay away from CFDs. Manage your own trading and investment. Trust no-one with your money.
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Not applicable
Are you saying SSF are safer than CFDs?
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Super Contributor
nope...no stop loss on SSF...ALSI futures or ungeared indices. Shares for investing only
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Not applicable
So you execute the stop loss manually?
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Super Contributor
you can set a stop loss on ALSI futures
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Contributor
Well, it was an account where funds had been traded using CFD's. I do have access and can monitor trades, however, left it to the "experts" to make decisions. I really sense poor management - poor stock selection, no stop losses in place...
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Super Contributor
I didn't even knew brokers are allowed to trade CFD's with clients money. It a crazy idea to be honest, unless you use a portion of the funds to hedge a portfolio when you expect a downturn. It's difficult enough to manage your own leveraged portfolio, never mind allowing a broker to juggle a few portfolio's all at one time real time. There should be a law against this.
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Contributor
Agreed.... I've now learnt to Never trust ANYONE with my money... they dont have your interest in mind, and frankly anyone can beat them...
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Valued Contributor
speak to the FSB, that's about you only chance ..
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