“I have two great enemies, the southern army in front of me and the financial institutions, in the rear. Of the two, the one in the rear is the greatest enemy…..” – Abraham Lincoln
Here is a detailed, chronological account of our almost unfathomable story, and how big banks managed to swindle us, self-directed traders in securities, out of our livelihood, leaving us homeless through illegal financial practices that we are actively fighting to undo through legal proceedings.
UBS and Credit Suisse: Breaches of Contracts and Regulatory Provisions
- In 2009 we established a trading account with Credit Suisse Branch, Nassau with an initial balance of USD $360,312.
- From February to March 2009, we made a net profit of USD $1,147,418 resulting in an interim balance of $1,507,730 in May 2009.
- This $1.5M reflects a four-fold increase in account size through discretionary trading
- The agreement in place was for them to charge us a 0.7% flat fee, which would have amounted to ~ $3,600 in a $360K initial capital.
- Instead, they maliciously charged us a per-trade fee and after weeks of unanswered requests, we were presented with an account statement 3 months later (not daily, as is done everywhere else), with commissions in the amount of $570,000.
- Commitments to correct for this erroneously exorbitant commission were not honored, and instead, in 2014, Credit Suisse closed our account without any refund of this commission and informed us that they are “not here to rob clients” and are working on a solution.
- In September 2015, Credit Suisse in answering our demand letter informed us that it has no intention to honor the debt.
- We were convinced by the bank that in order to make decent profits we need substantial trading capital. To get access to substantial trading capital, and premium trading services, we entered an agreement with UBS in October 2012 to take out a 50% home equity (Real Estate Collateralized) loan ($1.4M based on home appraisal), of which 50% ($700K) would be invested in a trading account with them.
- Trading services were not made available until July 2013.
- In addition, UBS Bahamas trading services were completely dysfunctional by September 2013 (no electronic platform, long execution times).
- The dysfunction in their trading system came with a substantial opportunity cost. We made a net profit per month of USD $30,694 in August 2013. But had our orders been executed at the time of placing the orders, the gain would have been three times greater.
- Our multiple requests to finally provide us with the promised service, resulted in:
- UBS’ refusal of Direct Market Access.
- An underhanded threat by UBS that should we continue to complain, the conditions of our mortgage would be reviewed.
- The level of pressure on us reached unthinkable levels for any service provider and its clients, and totally unacceptable in trading, where calmness and psychological balance is commonly recognized as 90% of success.
- The climax came on September 18, 2013, when we attempted to immediately sell a position after realizing the Fed announcement on that day would result in significant losses. Markets are known to react sharply and quickly to Fed announcements. Had our sell order been executed in time, the loss would have been minimal. But the sell order placed @ 1:58 PM over the phone was delayed and actually executed @ 2:05 PM.
- Actual loss of profits topped the total sum of USD $137,977 lost, due to this and other delayed executions in September/August, in breach of the Investment Agreement Statute laws. We asked for a refund of this amount.
- In response to our demand to refund, UBS issued a wrongful margin call when:
- Net cash value was of USD $589,362.
- No position was held.
- Refunds in the process of discussion of USD$137,977 would bring the total to USD $727,339, which is USD $27,339 above the hypothetical minimum of USD $700,000.
- Net cash value was of USD $589,362.
- This halt of trading resulted in further damages include loss of profits in the amount of USD $59,520, the actual net profit which we lost due to the trades not being carried out by UBS during the period from 19 September 2013 to 10 October 2013.
- UBS only partially compensated us for loss of profits sustained due to UBS’ faults in the best executions of trading orders by way of two (2) compensation payments for a total of USD $3,110.
- We offered to honor paying all interest payments upfront in exchange for the right to simply withdraw our money to trade elsewhere as a result of this debacle, and have four years up to the contract expiration in September 2017.
- UBS refused our offer. In March 2014 it announced that it is in process of shutting down its branch in the Bahamas, making itself in any event unavailable to honor the contract upon its expiration.
- In April 2014 UBS wrongfully, without our permission, sequestered money from our account of USD$ 523,323,49, while unjustly calculating interests for the money frozen on our account from September to April to which we were denied access after the wrong “margin call”.
- In November 2014, instead of refunding us for unbelievable wrongdoing, UBS commenced legal proceedings, you can read more here: https://letsmaketheworldfairer.com/2018/04/23/narrative-of-facts/.
- In November 2015 we commenced an action against UBS.
- In October 2018 the Securities Commission of the Bahamas confirmed that UBS’ trading employees were unregistered, meaning they lacked the skill to provide adequate service: https://letsmaketheworldfairer.com/2018/11/18/5-november-2018-sec-confirmed-ubs-was-unregistered/.
The aggression of UBS cannot be understood if just considered in isolation. The related reasons for such an oppressive approach are:
– the same law firm which represents UBS also represents Credit Suisse, where they know they have no legitimate defense;
– the liquidator for UBS is ex-Attorney General of the Bahamas, our ex-neighbor from Lyford Cay, John Delaney QC. This gentleman self-promotes himself as a type of guru who knows all aspects of law. However, looking at his dubious decisions to file litigation against us, we have big doubts about his professional competence;
– the liquidator (John Delaney QC) is also the owner and CEO of the Delaney and Partners firm, which among other things, offers real estate services, promoting itself as one of the primary real estate companies in the country.
There is a clear conflict of interest here – the real estate, our home, is of high value in one of the more exclusive communities of the world. Not one piece of real estate in the community was sold for under $3 million during the last five years (2015-2019). And yet this did not stop John Delaney and his associate (Ms. Lena Bonaby) to swear an affidavit filed on …… where they declared that they were unable to receive an offer to cover their expenses (insert exact quote). But UBS’ expenses (not yet confirmed by the court) with the order is around $900,000, but the house’s certified appraisal value is much greater: $3,700,00 and growing (due to major renovations in the area).
We call it an attempt at robbery in our simple human society, where it appears this individual did not grow up.
For any fair and independent observer, it would simply be impossible to find any logic in the course of action the liquidator took in this litigation, himself being a QC.
UBS has an order for possession against us, successfully challenged in the Privy Council of the UK, the total value with all eventual legal expenses being about $1.0 M. We moved an action against UBS for $6.0 M. The house value, according to two (2) independent appraisals is $3.7 M in December 2017 and continues to grow.
The question is, why would they take possession of our house–which is clearly restricted by the judge– only to make improvements while throwing us onto the street with six children? We were left without suitable accommodation, no rights to be engaged in any gainful activity without licensing, and without any capital–not just to trade, but to make any sort of a daily living.
The answer is simple – there is a greedy circle that thinks they can bully and corner us into submission by taking all of our resources away from us. They think they are somehow above the law and protected by UBS and Credit Suisse, all the while knowing that they (the banks and law firm) have no defense against our claims.
Their only hope is that we will give up, squeezed by our hardship and our children’s oppressed childhood.
Well, they underestimated our resolve, as we have committed to fight to the end!
We are empowered now with so many dear new friends, who are helping and providing for us in an almost magical way, the editor of this text included.
I will name you if you allow me to, and will always praise you and the source which sent you all to us!
Please, support our website and sign our petition on change.org: Ask UBS to Stop Obstructing our Litigation. The pressure this creates for UBS’ “legal” team helps keep them in check and makes it much harder for them to obstruct the course of our litigation. We hope eventually to bring this to a brighter end, to end our hardships, and to set a precedent for others who might find themselves scammed and defrauded by banks and other white-collar criminals.