I'd like to ask some advice regarding an issue I had with a brokerage dealer (Schwab) without my authorization they took money out of my account to transfer it to someone else's account and according to the FINRA organization is a violation of my rights, here is how it all happen:
I met a wealthy old man around February 2008. I did computer work for him (I'm an IT Engineer) and we became friends. He had been trading stocks for around 40 years and had some millions on two accounts. At the time I knew nothing about the stock market. He insisted that I should borrow some money and he would advise me how to invest it. I finally took him on the offer around June 2008 I borrowed some money with 0% interest for a year and he made me bought stocks he already owned that according to him should hold or do better and were giving dividends.
I stopped working fixing computers and ended up spending most of the day at his office talking about the stock market (he told me I could do more money trading a few hours than fixing computers all day), doing research for him on the internet for stocks that met the criteria he was looking for, helping him with computer issues, problems with Email, Fax, etc. for free. In exchange, he would be my investment advisor and would teach me how to do day trading (he would do it on his account I would do it on mine.) and long term trading, he even offered to lend me some money, made me sign a promissory note that I will pay him back in a year and told me to pay it back to him after he helped me build my account.
Some days we would lose and some days we would make money but in general we were losing more money than we were making. He encouraged me to borrow more money and even he lent me some more money under the same conditions as before and told me all we needed was to make a couple of good deals.
By October 2008 when the market started crashing we both were losing a lot of money and I got concerned, I started telling him my concerns and he told me that he had been in situations like this many times during the last 40 years and that one's needs to have a strong stomach and guts to do it in this business. I told him that I was trading with borrowed money and I didn't want to end up in dept. He told me not to worry that we were friends and he would not let me get in trouble.
By March 2009 he had lost almost half his money and I had lost most of the money in my account. He told me that he had never seen something like what happened but was very pleased with my progress and he still had a few millions left (he had 2 accounts one of them managed by the brokerage dealer and the other by him and told me the brokerage dealer had been insisting for a long time on managing his other account since they get more commission this way but he wanted to keep doing the trading by himself on this one). He started suggesting to open a joint account he would fund the account with 50k and wanted me to do the research on stocks and do the trading using what he had taught me and what I had learned we could split the profits and I would be able to start paying my loans that way. He would also use the stocks that I would find that met the criteria he liked to do investments on his account.
I lost track of him but on August 2009 he called me from his house saying that he had a home office now and wanted me to go to his house to talk. I went to his house and we started talking about opening the joint account again. On the way out, I noticed his wife had been listening to us behind the door and she told me she didn't want her husband to get into any business. I address that to him on the next conversation on the phone and told me not to worry about it that he would talk to her and take care of that.
He called me again and I went to his house, we filled out the paper work and opened the account. He funded the account with 50k and I started doing full time research and a little bit of day trading to test the market.
Two weeks later on Thursday I received a call from the brokerage dealer representative, It was a three way call my friend / partner said that the plans had changed and he wanted to close the joint account, he told the representative to move half the money from the joint account to my own personal account, the representative did it and told him that he would have to wait for three business days for the last transaction to settled to move the rest of the money and close the account.
I received a call from another brokerage representative on Sunday saying that my friend / partner was at the other line and wanted to talk to me but had lost my number and asked them to call me I accepted the call and agree to call him to his home number. When I called him he told me that he wanted to see me soon that he was going to step to the side but he wanted me to build my account and be careful and pay my loan soon. Suddenly I heard the voice of what it seem to be his wife saying hello with an angry tone so I told him I will call him and go see him by the end of the week.
On Tuesday I got a voice mail from the wife with an angry voice saying that the police will investigate me for my dealings with her husband. I logged into my brokerage account on line to find out that the joint account and my own personal account had been placed on hold (I had funds on my account previously to the transfer and everything was on hold). I called the brokerage dealer and nobody wanted to tell me why even my own personal account was on hold and told me to go to the local office (where the accounts were opened). I went to the local office and the manager I talked to, was very nervous and didn't tell me what was going on, he told me someone would call me the next day. At this point I contacted a lawyer from the yellow pages which told me they should not had put my own account on hold and that they had no right to remove any funds from my account unless they had a court order.
I didn't get any call the next day so I went to the office again. This time I was taken to the office of another manager who told me he was aware of my dealing with the other guy and that he had been a friend of him for a while and that the accounts had been placed on hold for investigation purposes. Then he started asking me if the other guy told me he was going to give me the money and other personal questions I told him I didn't wanted to discuss all the details with him (as instructed by the lawyer) but I wanted to have access to the funds in my own personal account, he gave me his business card, hurried me out the door and told me to tell my lawyer to call them.
When I got out of the local office I checked my account on line and I saw that the funds that had been transferred to my account the previous Thursday, were transfer back to the joint account and from there all the money from the joint account to my friend's account. The rest of my funds on my won account remained on hold.
I check on Finra.org and I found out that removing funds without the account owner authorization is prohibited so I called the brokerage dealer to question them about it. I was told that the transaction took place at the local office I had visited.
When I called the client advocacy team I was told there was a complaint of some sort of fraud and that if I wanted to complain about the transaction I didn't authorized, I was going to have to take it outside of the brokerage dealer, and that my account had been close and I needed to remove my funds.
I'm not only offended but deep in dept. The guys at the local branch don't know the whole story neither does the wife but the wife threatened me with the police and I know one of her nieces is a local police officer.
I have copies of statements, application, transactions and names and extension from representative we spoke to and those conversations are recorded. I have a witness that he suggested me to get money to teach me how to invest (that witness still does work for the family and told me he has some Alzheimer and looks like the wife is controlling all the money now).
I need some advice if I should file a complaint with FIRNA or try to hire a lawyer unfortunately I don't have much money since I'm unemployed. Or If anything I did here sounds like I did something wrong.
Thanks in advanced for your advice.
I met a wealthy old man around February 2008. I did computer work for him (I'm an IT Engineer) and we became friends. He had been trading stocks for around 40 years and had some millions on two accounts. At the time I knew nothing about the stock market. He insisted that I should borrow some money and he would advise me how to invest it. I finally took him on the offer around June 2008 I borrowed some money with 0% interest for a year and he made me bought stocks he already owned that according to him should hold or do better and were giving dividends.
I stopped working fixing computers and ended up spending most of the day at his office talking about the stock market (he told me I could do more money trading a few hours than fixing computers all day), doing research for him on the internet for stocks that met the criteria he was looking for, helping him with computer issues, problems with Email, Fax, etc. for free. In exchange, he would be my investment advisor and would teach me how to do day trading (he would do it on his account I would do it on mine.) and long term trading, he even offered to lend me some money, made me sign a promissory note that I will pay him back in a year and told me to pay it back to him after he helped me build my account.
Some days we would lose and some days we would make money but in general we were losing more money than we were making. He encouraged me to borrow more money and even he lent me some more money under the same conditions as before and told me all we needed was to make a couple of good deals.
By October 2008 when the market started crashing we both were losing a lot of money and I got concerned, I started telling him my concerns and he told me that he had been in situations like this many times during the last 40 years and that one's needs to have a strong stomach and guts to do it in this business. I told him that I was trading with borrowed money and I didn't want to end up in dept. He told me not to worry that we were friends and he would not let me get in trouble.
By March 2009 he had lost almost half his money and I had lost most of the money in my account. He told me that he had never seen something like what happened but was very pleased with my progress and he still had a few millions left (he had 2 accounts one of them managed by the brokerage dealer and the other by him and told me the brokerage dealer had been insisting for a long time on managing his other account since they get more commission this way but he wanted to keep doing the trading by himself on this one). He started suggesting to open a joint account he would fund the account with 50k and wanted me to do the research on stocks and do the trading using what he had taught me and what I had learned we could split the profits and I would be able to start paying my loans that way. He would also use the stocks that I would find that met the criteria he liked to do investments on his account.
I lost track of him but on August 2009 he called me from his house saying that he had a home office now and wanted me to go to his house to talk. I went to his house and we started talking about opening the joint account again. On the way out, I noticed his wife had been listening to us behind the door and she told me she didn't want her husband to get into any business. I address that to him on the next conversation on the phone and told me not to worry about it that he would talk to her and take care of that.
He called me again and I went to his house, we filled out the paper work and opened the account. He funded the account with 50k and I started doing full time research and a little bit of day trading to test the market.
Two weeks later on Thursday I received a call from the brokerage dealer representative, It was a three way call my friend / partner said that the plans had changed and he wanted to close the joint account, he told the representative to move half the money from the joint account to my own personal account, the representative did it and told him that he would have to wait for three business days for the last transaction to settled to move the rest of the money and close the account.
I received a call from another brokerage representative on Sunday saying that my friend / partner was at the other line and wanted to talk to me but had lost my number and asked them to call me I accepted the call and agree to call him to his home number. When I called him he told me that he wanted to see me soon that he was going to step to the side but he wanted me to build my account and be careful and pay my loan soon. Suddenly I heard the voice of what it seem to be his wife saying hello with an angry tone so I told him I will call him and go see him by the end of the week.
On Tuesday I got a voice mail from the wife with an angry voice saying that the police will investigate me for my dealings with her husband. I logged into my brokerage account on line to find out that the joint account and my own personal account had been placed on hold (I had funds on my account previously to the transfer and everything was on hold). I called the brokerage dealer and nobody wanted to tell me why even my own personal account was on hold and told me to go to the local office (where the accounts were opened). I went to the local office and the manager I talked to, was very nervous and didn't tell me what was going on, he told me someone would call me the next day. At this point I contacted a lawyer from the yellow pages which told me they should not had put my own account on hold and that they had no right to remove any funds from my account unless they had a court order.
I didn't get any call the next day so I went to the office again. This time I was taken to the office of another manager who told me he was aware of my dealing with the other guy and that he had been a friend of him for a while and that the accounts had been placed on hold for investigation purposes. Then he started asking me if the other guy told me he was going to give me the money and other personal questions I told him I didn't wanted to discuss all the details with him (as instructed by the lawyer) but I wanted to have access to the funds in my own personal account, he gave me his business card, hurried me out the door and told me to tell my lawyer to call them.
When I got out of the local office I checked my account on line and I saw that the funds that had been transferred to my account the previous Thursday, were transfer back to the joint account and from there all the money from the joint account to my friend's account. The rest of my funds on my won account remained on hold.
I check on Finra.org and I found out that removing funds without the account owner authorization is prohibited so I called the brokerage dealer to question them about it. I was told that the transaction took place at the local office I had visited.
When I called the client advocacy team I was told there was a complaint of some sort of fraud and that if I wanted to complain about the transaction I didn't authorized, I was going to have to take it outside of the brokerage dealer, and that my account had been close and I needed to remove my funds.
I'm not only offended but deep in dept. The guys at the local branch don't know the whole story neither does the wife but the wife threatened me with the police and I know one of her nieces is a local police officer.
I have copies of statements, application, transactions and names and extension from representative we spoke to and those conversations are recorded. I have a witness that he suggested me to get money to teach me how to invest (that witness still does work for the family and told me he has some Alzheimer and looks like the wife is controlling all the money now).
I need some advice if I should file a complaint with FIRNA or try to hire a lawyer unfortunately I don't have much money since I'm unemployed. Or If anything I did here sounds like I did something wrong.
Thanks in advanced for your advice.
