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VIC Sue Fake Financial Advisor for Bad Advice?

Discussion in 'Other/General Law Forum' started by Terry Ho, 4 August 2014.

  1. Terry Ho

    Terry Ho Member

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    X is a 35 year old accounts clerk who is a keen small-time investor on the stock market. As he is a good golfer, he is sometimes invited to play in amateur tournaments at an exclusive golf course. Last month X was paired with myself, an Asian businessman who had recently arrived in Australia. In an attempt to gain consulting work, X strongly implied that he was a successful financial advisor.

    During the game, X urged me to invest in a small high-tech company which he said he had researched and was going “to boom”. X added, “Like they say in the ads, all care taken but no responsibility accepted”. I followed X's advice and lost $10,000 because the company was badly managed. Am I able to recover my losses from X who made himself out to be a financial advisor?
     
  2. John R

    John R Well-Known Member

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    Hi Terry,
    As an analogy, if we met and you gave me a "certainty" for this weekend's horse racing that I bet on, but lost, would you expect me to approach you for compensation? I assume that your answer would be "no" (or something less polite).
    To my knowledge, a similar outcome would apply to your situation unless:
    1. The accounts clerk was actually a financial advisor, accountant, etc. and you had a formal client-advisor relationship with them and could demonstrate that their advice was negligent; or
    2. The accounts clerk misled or deceived you because they had an undisclosed vested interest in you investing in the business (e.g. were receiving an undisclosed commission).
    Hope this helps.
     
    Terry Ho and winston wolf like this.
  3. Terry Ho

    Terry Ho Member

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    Thank you John for your prompt reply
     

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