Losses occuring against improper calls

5 years ago

Hi Sir
I had engaged one sub-brokerage firm based on his commitment to deliver 4-5% return minimum through trading.
For this I had opened one account with Aditya Birla and deposited Rs 16 Lacs.

1. With in 2-3 days of experience, I realised that the firm's interest was brokerage as I did not find any strategy.
2. The owner called up and persuaded to give him time so that he can show performance. He requested for 3-4 months of time to show result.
3. After a period of 3.5 months, I have found that there was already a loss of Rs 6.5 Lacs in the account and capital had eroded.
4. During this period there was no call from him or his team on the trades done just information was coming through Aditya Birla report, which I did not follow.
5. One day when Aditya Birla team spoke and took feedback, I confirmed that I did not have any idea on the losses since there was no confirmation or intimation given by sub-broker.
6. Aditya Birla locked the account .
7. Again the owner pleaded and pleaded to give him chance as he was occupied in his family related issue as his mother was cancer patient and he him self was not well.
8. I approved to resume account (primarily on humanitarian ground)and he started trading again with daily intimation coming to me .
9. On the first day itself of resuming, I showed him the call which he executed when actually in market call was to book profit at that level.
10. He requested to check and resumed trading.
11. For 1.5 months there better calls and portfolio slightly started recovering losses.
12. He started giving daily reports and taking confirmation on mail.
13. I confirmed since I continued to trust him.
14. Meanwhile, I got suspicious again since calls were very less as compared to earlier time.
15. When checked, I realised again there were calls, in which, money got struck due to wrong positions and hence money was not available for trade.
16. I confronted him again and asked for P&L statement. I realised the lossess had balloned in excess of Rs 8 Lacs.
17. When Aditya Birla asked opinion, I confirmed that I had no idea on his calls so Aditya Birla blocked account again.
18. This time despite his request, I have not resumed sevices.Though he committed that he shall reimburse his brokerage amount which I did not take.
19. There are thee open positions in which there is loss accumulated.
20. Total loss as on date is around Rs 10 Lacs.
21. Now he is not responding to phone calls or messages when I am seeking clarification as to why there was no stop loss put to presently open calls.
22. If he was attentive, he could have put situation under control by putting stop losses., which he did not do.

In such situation what can I do to recover losses from him when
1. I have many times called on his quality of calls(proved)
2. Not putting timely stop losses.(proved)
3. Now no responses from his side.

The amount of loss is Rs 10 Lacs. Please guide.

Regards
Rajesh Gupta