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Kim Mangalindan, Facebook Freedom Challenge Group (legal question - need help)


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Kim Mangalindan, Facebook Freedom Challenge Group (legal question - need help)

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  #11 (permalink)
Market Wizard
New York, NY
 
Experience: Beginner
Platform: Vanguard 401k
Broker: Yahoo Finance
Trading: Mutual funds
 
Posts: 1,077 since Jul 2012
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First off, sorry to hear that you're in this situation.

Next, I want to second @userque's suggestion that you go to a source of more qualified advice.

Finally, here's my own opinion - but keep in mind that I'm not a lawyer and this doesn't constitute legal advice.

First, would you consider your income level at a level where you qualify for free legal aid? If you do, you should get qualified assistance.

If you don't, my next best advice is that I would suggest you take just a fraction of the money you would have spent on this "coach" in a month to get 1 hour of consultation with a commercial lawyer, who could also help point you to his colleagues in collections and securities. I've always found for all lawyers I've worked with - from those who charge $150 per hour to those who charge $1,300 per hour - that they have a network of friends who can give you the right class of advice in multiple domains. They can probably better assess the situational context whether it's sensible to report this "coach" to the FBI for fraud or any other things you need to do. (Unlike other posters on this thread, I'm not sure if this is a clear cut case of securities fraud. Did he induce you to make any investments? Were there any promises of turning a small, actual investment in the market into larger gains without any risk disclosure?)

It sounds to me that your problem is one at a level of complexity where a non-name brand lawyer can get all your loose ends tied up for 1 hour of work at $150-250. This is also very important because it immediately sets you up for 1 level of protection: there are fair debt collection laws at both a federal and state level that will likely require the "coach" to forward any collection claims to your lawyer, failing which it's deemed harassment. My experience is that at this point the "coach" will give up.

If it makes you feel better, here's what I think:

1. Said "coach" does not appear to be aware what he is talking about. It seems at best he can assert a claim for debt collection. And it seems that you have a much stronger claim for nonperformance of duty and breach of contract, regardless of the language on the paperwork that you've executed with him.

2. No one with the ability to move the E-mini S&P 500 that I know is silly enough to bring a civil case for a couple grand all the way to court. You know it takes like $80-250k to litigate these types of things at a minimum for both parties? Not that it is a sound approach but you could literally self-represent and said "coach" will probably run out of cash before it sees the light of day. In fact I don't know what's this $-- amount but some courts don't even have jurisdiction to take on cases for too small of an amount.

3. Moreover, abovementioned fair debt collections laws generally prohibit one from making threats and harassment which seems like said person is bordering on.

4. Furthermore, him litigating a debt claim now will just open himself up to discovery and a countersuit which, based on what you've said, seems highly disadvantageous to his "business": now others in the group may find out of his deceptive practices publicly through court filings or - depending on how exactly his "business" is conducted - he may be legally obligated to disclose the existence of an ongoing lawsuit or investigation against him to his customers.

You have multiple layers of protection here. I know what it's like the first few times to be served a (bad faith) legal threat and I know it's a sh*tty feeling that keeps you awake at every corner. But go about your day, get legal assistance, and then walk your dog, do your dishes, stay healthy, and keep your mind distracted from this matter.

Lastly, please stop hiring trading coaches. I can guarantee you that I've traded orders of magnitude more than said "coach". And I actually have both licenses and exchange memberships if it gives me some form of authority. And I've actually coached employees and friends, among whom many now work for the largest trading firms in the world (Citadel, IMC, Jump, HRT, XTX, Virtu and so on). And despite all this, I'm certain I don't know what I'm talking about 95% of the time and doubt I can coach someone. But there's one thing I know: A legitimate trading mentor will pay you to train under them because they're investing in your potential to help their business, and because they recognize that it takes at least a year of hard work and full-time employment for someone to become useful at trading. Never the other way around.

Good luck.

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  #12 (permalink)
New York City + NY/United States
 
 
Posts: 225 since Sep 2018
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Can't you just charge it back and tell the scammer to f off?

It's like everyone here was born yesterday.
Kasitlyo View Post
I have a legal question and need a desperate help, I agreed to a Mentor for a year membership of $--K/month on mentoring and now I figured that he is just hustling the group of his students, so I bailed out after Three months. Now he is threatening to sue me and garnish the rest of amount on my income and property. He claimed to be really rich and his group can move the market and giving directions where the market (ES mini) will do, and I start noticing he got images/pictures trades that is fake or scripted when it is all shown as making money (so basically SIM trade and images it as his live trades). I try to follow it in SIM to copy and practice and its impossible to follow all his winning. Does any traders got this type of experience, want to know, how can I protect myself from him in the court just in case. I only agreed on his website and leave my Credit Card in the file for monthly due, CC is now closed and I am only trading since last March when Covid-19 starts. Thank you for any advice, please help me...


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  #13 (permalink)
San Francisco
 
Experience: Beginner
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artemiso View Post
If you don't, my next best advice is that I would suggest you take just a fraction of the money you would have spent on this "coach" in a month to get 1 hour of consultation with a commercial lawyer, who could also help point you to his colleagues in collections and securities. I've always found for all lawyers I've worked with - from those who charge $150 per hour to those who charge $1,300 per hour - that they have a network of friends who can give you the right class of advice in multiple domains. They can probably better assess the situational context whether it's sensible to report this "coach" to the FBI for fraud or any other things you need to do. (Unlike other posters on this thread, I'm not sure if this is a clear cut case of securities fraud. Did he induce you to make any investments? Were there any promises of turning a small, actual investment in the market into larger gains without any risk disclosure?)

It sounds to me that your problem is one at a level of complexity where a non-name brand lawyer can get all your loose ends tied up for 1 hour of work at $150-250. This is also very important because it immediately sets you up for 1 level of protection: there are fair debt collection laws at both a federal and state level that will likely require the "coach" to forward any collection claims to your lawyer, failing which it's deemed harassment. My experience is that at this point the "coach" will give up.

While you have raised excellent points, lawyers aren't magicians. There are some bad lawyers out there who over-promise and may be just as shady as the "coach." A lawyer who charges $150 in San Francisco is probably not very established. Specialist lawyers are usually more expensive.

FBI does investigate Internet and business fraud. It sounds like the "coach" is bluffing and doing many questionable things on the Internet. The public can report this on the FBI website. A lawyer is not needed.

The "coach" may back off after hearing the words "FBI." A lawyer may not even be necessary.

In the meanwhile:

https://attorneys.superlawyers.com/securities-litigation/california-northern/san-francisco/

https://www.fbi.gov/scams-and-safety

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  #14 (permalink)
Site Moderator
Sarasota FL
 
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I'm sorry to read about your problems. As a non-lawyer, I have only a few thoughts, which I hope will be of some help:

1. You are not really going to get a legal opinion you can count on, nor a worthwhile opinion on any legal matter, in an internet forum. If you really want to know what to do and if you want a legal opinion, you will have to talk to an actual lawyer. Lawyers are expensive, but probably just a few hundred bucks for a simple consultation, and if you're worried it may be worth it. Also, if you're trading, and if you're paying mentors, you should be able to manage it.

2. It is easy for a sleazy vendor to type the words "I will sue you." It takes nothing at all for him to do this. But to succeed, he will have to get a lawyer, and then go to court and win. It will cost him to do this, and the win is not something that is assured, and you will have to be notified and will have your say also. Without a court judgement, he can't do anything to you. Also, you didn't say what the amount at issue is (and you have every right to keep it private, of course), but most companies will not go to the trouble of suing for the relatively small amounts of a few thousand bucks -- their costs are likely to be greater. At some point, of course, they might, and there is not necessarily any way to tell whether they will or not, but just remember that their costs, time and trouble will keep a lot of people out of courtrooms.

In other words, don't assume you are in terrible danger, and do consult with a lawyer if want to be sure.

3. I hope you have learned not to believe anyone who tells you that for just x amount of money, they will make you rich. They simply will not. The better the traders that they claim to be, the more absurd the claim is that they will share their wonderful secrets with you. The fact is usually that they don't have anything to share.

You have found a scammer and you were scammed.

You may even have reason to threaten to sue him. Ask a lawyer about your options.

4. Finally, again, no one here can give you legal advice. There are lawyers who are members of the forum, but they are not going to toss off casual advice without having you as a client and knowing more about the situation, any more than a doctor is going to diagnose a medical issue without examining you. Sorry, but that's the simple reality of it.

Good luck, and definitely stay away from any more offers to become a successful trader just by paying someone to show you how. They never really do.

Bob.

When one door closes, another opens.
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  #15 (permalink)
San Francisco CA
 
Experience: Beginner
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artemiso View Post
First off, sorry to hear that you're in this situation.

Next, I want to second @userque's suggestion that you go to a source of more qualified advice.

Finally, here's my own opinion - but keep in mind that I'm not a lawyer and this doesn't constitute legal advice.

First, would you consider your income level at a level where you qualify for free legal aid? If you do, you should get qualified assistance.

If you don't, my next best advice is that I would suggest you take just a fraction of the money you would have spent on this "coach" in a month to get 1 hour of consultation with a commercial lawyer, who could also help point you to his colleagues in collections and securities. I've always found for all lawyers I've worked with - from those who charge $150 per hour to those who charge $1,300 per hour - that they have a network of friends who can give you the right class of advice in multiple domains. They can probably better assess the situational context whether it's sensible to report this "coach" to the FBI for fraud or any other things you need to do. (Unlike other posters on this thread, I'm not sure if this is a clear cut case of securities fraud. Did he induce you to make any investments? Were there any promises of turning a small, actual investment in the market into larger gains without any risk disclosure?)

It sounds to me that your problem is one at a level of complexity where a non-name brand lawyer can get all your loose ends tied up for 1 hour of work at $150-250. This is also very important because it immediately sets you up for 1 level of protection: there are fair debt collection laws at both a federal and state level that will likely require the "coach" to forward any collection claims to your lawyer, failing which it's deemed harassment. My experience is that at this point the "coach" will give up.

If it makes you feel better, here's what I think:

1. Said "coach" does not appear to be aware what he is talking about. It seems at best he can assert a claim for debt collection. And it seems that you have a much stronger claim for nonperformance of duty and breach of contract, regardless of the language on the paperwork that you've executed with him.

2. No one with the ability to move the E-mini S&P 500 that I know is silly enough to bring a civil case for a couple grand all the way to court. You know it takes like $80-250k to litigate these types of things at a minimum for both parties? Not that it is a sound approach but you could literally self-represent and said "coach" will probably run out of cash before it sees the light of day. In fact I don't know what's this $-- amount but some courts don't even have jurisdiction to take on cases for too small of an amount.

3. Moreover, abovementioned fair debt collections laws generally prohibit one from making threats and harassment which seems like said person is bordering on.

4. Furthermore, him litigating a debt claim now will just open himself up to discovery and a countersuit which, based on what you've said, seems highly disadvantageous to his "business": now others in the group may find out of his deceptive practices publicly through court filings or - depending on how exactly his "business" is conducted - he may be legally obligated to disclose the existence of an ongoing lawsuit or investigation against him to his customers.

You have multiple layers of protection here. I know what it's like the first few times to be served a (bad faith) legal threat and I know it's a sh*tty feeling that keeps you awake at every corner. But go about your day, get legal assistance, and then walk your dog, do your dishes, stay healthy, and keep your mind distracted from this matter.

Lastly, please stop hiring trading coaches. I can guarantee you that I've traded orders of magnitude more than said "coach". And I actually have both licenses and exchange memberships if it gives me some form of authority. And I've actually coached employees and friends, among whom many now work for the largest trading firms in the world (Citadel, IMC, Jump, HRT, XTX, Virtu and so on). And despite all this, I'm certain I don't know what I'm talking about 95% of the time and doubt I can coach someone. But there's one thing I know: A legitimate trading mentor will pay you to train under them because they're investing in your potential to help their business, and because they recognize that it takes at least a year of hard work and full-time employment for someone to become useful at trading. Never the other way around.

Good luck.

Thank You, very much for all your advised...you are right like last night I woke up around 4 AM and start thinking the scenario, what will going to happen... I join mentoring to make a little financial supplement, now I am buried with CC charged and the worse is my wife is so pissed-off that instead of earning money, I hope she will not divorce me.

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  #16 (permalink)
Market Wizard
New York, NY
 
Experience: Beginner
Platform: Vanguard 401k
Broker: Yahoo Finance
Trading: Mutual funds
 
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Kasitlyo View Post
Thank You, very much for all your advised...you are right like last night I woke up around 4 AM and start thinking the scenario, what will going to happen... I join mentoring to make a little financial supplement, now I am buried with CC charged and the worse is my wife is so pissed-off that instead of earning money, I hope she will not divorce me.

You kept a lookout for evidence of the scammer's true ability, were able to change your initial assumptions after seeing the warning signs, and made an early decision to cut it off before this became a cost sink. If it's any consolation, it at least shows that you have mental equanimity and ability to evaluate evidence in a difficult situation, which already sets you apart from most people.

You don't deserve sympathy, but you deserve a chance. And I hope your wife can see that, as you're only going to emerge from this wiser and with a smaller hole in your pocket than if you had just continued paying the scammer.

Dealing with the law sounds a lot daunting than it actually is. (Of course, don't tell your wife this directly - no one wants to be told that they're blowing something out of proportion.) My SO gets serious anxiety whenever I have to deal with legal matters, too. In my experience, keeping your own composure and showing that you're able to brush it off and go about your normal routine will help your wife cope with it a little better.

In practice, if you're a trader and familiar with the concept of transaction costs, brushes with the law aren't that scary. A heuristic I like to use is that you can often view legal fees like a transaction cost of 0.5-20% on the notional value of the event at hand. Have a commercial lease that is worth $5M? Pay $25k to negotiate the termination clause and rent improvement benefits. Have a fund administration agreement that costs $100k per year? Pay $5k to review the liability and indemnification. Have a disgruntled employee that you fired threatening to claim a $100k unpaid bonus? Pay $20k to fend them off. Have someone threatening to sue you for $20k in damages? Pay $2k to keep it off your mind.

It doesn't matter if your legal opponent is a billionaire, the SEC, the US government itself, or a run-of-the-mill scammer. They claim you owe them $20k? There's going to exist a good lawyer out there who will capably resolve it for you for under $4k. (My heuristic works pretty well... I've fortunately never had to go up against the US government before, but I've had to deal with federal regulators and >100M net worth individuals.)

@Nolaughingmatter Made a good point about the quality of the lawyer. Unfortunately, I don't have a clear answer for you on how to find a good lawyer in your area.

How I've usually found lawyers is by word of mouth. I've seen others just rely on a review site for lawyers, but I find those lacking in sample size. If you plan on just using Google, in this case you may have one way to narrow your search: one way I've conducted due diligence on lawyers with litigation experience is to search up their colleagues and them on PACER. What's counterintuitive is that a good lawyer will probably not show up on court filings very much: they usually solve matters for you before it reaches the court. So in fact you probably want a lawyer who does not show up on any court filings in your current situation. However it is helpful to ensure that said lawyer has colleagues in the same firm who specialize in litigation and have won cases before, as they have someone to bounce ideas across the room.

When you're finalizing who to work with, I recommend making sure that said lawyer doesn't bill you for the initial call where you are just trying to decide who to work with. You can say that you're deciding who to work with and will be respectful of their time, but want to chat for 15-30 min on the phone to get to know them better. I don't think this is the sort of situation where you should be required to furnish a retainer either. Also, you can ask the lawyer for customer references before deciding to work with them.

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  #17 (permalink)
San Francisco
 
Experience: Beginner
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I have a feeling that this might be resolved without going to a lawyer, depending on how Kasitlyo plays it.

Bullies usually back off if you show you can fight back. Several people have suggested on how to effectively fight back, but of course this is up to you.

In any case, I would not place so much faith in lawyers. I have spent over 6 figures over the years on legal fees with a variety of different matters. Wills, contracts, estate planning, etc. those are worth the legal fees. Anything to do with litigation relies on too many unknown factors and those are the most costly and stressful. I've dealt with crappy, cheap lawyers with a rented table in a dilapidated shared office to arrogant, high-flying lawyers in crisp suits in big firms in several different countries. In general, the best offense is a good defense (i.e. don't get into trouble, be cautious). Don't make it a habit to rely on lawyers to solve problems. They might even make it worse; they make mistakes and false assumptions all the time. No matter what, they still get paid. The damages are for you to bear.

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  #18 (permalink)
Market Wizard
Cleveland Ohio/United States
 
Experience: Advanced
Platform: Tradestation
Broker: Tradestation, DeCarley, others
Trading: futures
 
Posts: 2,793 since Jul 2012
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Sorry, I am a bit late to the discussion...

DISPUTING WITH CREDIT CARD COMPANY

IF you have solid proof that the educator is doing something fraudulent or not providing agreed upon services, I would dispute it with the credit card company. The problem is you have to be able to explain your case to a non-trader who works disputes at the credit card company, AND of course you have to prove it to them. This is not always easy.

For example, you might say "he claims to trade live, but only shows sim results." That might be good proof for a trader, but not to a judge at a credit card company.

I would go through line by line everything you were promised. Look for something you did not get. Proving you did not receive something is easy for a credit card company to understand.

COMPLAIN TO CFTC


If there is evidence of fraud, go to CFTC.gov and file a complaint. You might even be a whistleblower and be eligible for compensation. Here's what happened in 2019: https://www.cftc.gov/PressRoom/PressReleases/8022-19

As part of this, you might have to get a whistelblower attorney.


CALL HIS BLUFF


If the person is a scammer, and you have solid proof of this, then call his bluff. Tell him to sue you, that you will love going through discovery and having him reveal all his trading results, etc. A good lawyer will dig like like crazy, and make him prove everything the scammer said.

**********************************************

My only caution here is that you may be convinced he is not legit, but that does not prove he is. Depending how far you go, at some point an independent set of eyes will have to evaluate the evidence and agree with you. Are you sure that will happen?


************************

If I were in your shoes, I would document the evidence you have, and send it to him saying that you want to end your relationship with him. Chances are if your evidence is solid he will back off.

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  #19 (permalink)
Toronto, Canada
 
 
Posts: 56 since May 2018
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Big Mike View Post
Can you name this vendor?

Have you searched, do they have an existing review thread here on the site?

The more you can share, the more likely members can help you.

Did you pay via PayPal?

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This can be very useful if OP decides to name this person / company, if permissible. Thank you.

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  #20 (permalink)
Reno, Nevada
 
Experience: Advanced
Platform: NinjaTrader
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You need to reveal who the scammer is. That's one of the reasons that communities like Big Mike's exist - to help traders avoid scammers. You would be doing everyone a service by writing a review about the person and his business.

Also the person who said to call his bluff is right. Tell him to go ahead and sue you in small claims court. I seriously doubt that whatever contract you signed had a clause that said:
"Even if I scam you, you have to pay". It may, however, say no refunds but there may be a cancellation clause. Even if there's no cancellation clause, it should say something about your subscription.

You should post the contract and let people read it. I bet there are multiple ways to get this guy.

He may be threatening you that if you reveal his name, he'll sue you for defamation. But that's because he doesn't want his name posted on websites like this.

This guy would probably be very easy to get if we knew who he was. Don't be afraid.

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