Scammed by online trading platform

Wiltz

I always fancied dipping my toe into the day trading world and decide to open an account back in december 2020.  After shopping around I settled on Trade360 as all the reviews were fine, I set up my initial account for £250 and got to it with my appointed account manager.  There was a lot of pressure to up the deposits from day one, which in and of itself I am not complaining about, I am more than capable of saying no, but I'd done enough personal research into the subject to know that, the more cash in reserve you have in your account acting as a buffer for the peaks and troughs of trading, even if you are not using it, the more secure your overall investments are, so I upped it to $5k (they work in USD), and I upped it several times after this to pursue some trades that needed more equity, all on the advice of the account manager, and as the account was growing nicely it seemed like a good idea to invest more money as the returns were outperforming anything I had elsewhere.

Things went extremely well and within a month we had grown my account to around $20k, some friends fancied getting in on the action and they put in around $4k and we eventually grew the account to $45k.  I am not greedy, and I am relatively risk averse so my plan was to withdraw what we had put in as early as possible so even if it all came crashing down we would at least break even, however I received a good deal of pushback from the account manager on this as she wanted to reach $50k which granted the account some vip status, which meant lower commission and a few other benefits.  Once we hit $45k we opened up a couple of trades on Gold and Crude Oil and they nosedived pretty quickly, which happens and is not a worry as long as you have that buffer I mentioned earlier, as the market then often corrects and you just ride it out.  To cut a long story short, I received an email from Trade 360 saying that they were pulling all of the UK accounts as they didn't have an FCA license to offer financial advice in the uk and my account would need to be closed, however as I had several trades open, on their advice I must add, that closing the account would just deduct whatever negative equity they were at at the time and wouldn't allow them to bounce back, which they had every other time.  They stopped taking my calls, and responding to my emails and my account manager stopped calling me which she usually did every day, to add insult to injury the number I had for her would now not connect and the customer support line would not answer or respond to my requests for a call back. The account was closed, which meant that even though I had a balance of $45k, my open trades at the time were deducted and I was left with just $9k, and seriously out of pocket.,  It is similar to having a bet on the football for your team to win and the bookies decide to call the result at half time when you are 1-0 down, meaning you lose.

I have already seen a few sites specialising in claims against trading companies, but they have the whiff of ambulance chasers about them and I don't want to be stung by high rates for taking the case.  Does anyone have any ideas or specific knowledge of legitimate legal action against this industry?

Aylesbury_Duck

$45k in five months is a heck of a toe-dip.  I'll admit I'm not familiar with day-trading (I invest £20k p.a. into a Vanguard S&S ISA and just leave it there) but this line rang alarm bells:

"the more cash in reserve you have in your account acting as a buffer for the peaks and troughs of trading, even if you are not using it, the more secure your overall investments are"

I don't understand how having uninvested cash makes the investments you have made more secure?

You may be better off in the savings and investments board section, where you'll find people with more specialist knowledge that you'll find on this board.  If this is a UK-wide action, 
presumably there will be many others in the same situation, albeit some of those may have crystallised a profit, I suppose.

jim1999

Looks like they are telling the truth.
https://register.fca.org.uk/s/firm?id=001b000000T8CiDAAV

"3) By 3pm BST on 6th of May 2021, 3 working days after VREQ, in respect of all its clients who are resident in the United Kingdom, the Firm must close all open trading positions and liquidate the positions into pound sterling balances (save for hedged positions which should be netted off rather than closed individually). Any positive cash balance held by a client resident in the United Kingdom must be paid to a bank or payment account held in the client’s name as soon as practicable and, in any event, by 17th May 2021, 10 working days after VREQ."

Aylesbury_Duck

jim1999 said:

Looks like they are telling the truth.
https://register.fca.org.uk/s/firm?id=001b000000T8CiDAAV

"3) By 3pm BST on 6th of May 2021, 3 working days after VREQ, in respect of all its clients who are resident in the United Kingdom, the Firm must close all open trading positions and liquidate the positions into pound sterling balances (save for hedged positions which should be netted off rather than closed individually). Any positive cash balance held by a client resident in the United Kingdom must be paid to a bank or payment account held in the client’s name as soon as practicable and, in any event, by 17th May 2021, 10 working days after VREQ."

So doesn't look like a scam then.  They're based in Cyprus and only ever had temporary permission to operate in the UK.  Not somewhere to be sinking $45k into as a way of dipping your toe into the world of day trading.

JJ_Egan

Action would need to be taken under the laws of Cyprus .