SINGAPORE: A man who invested S$49,500 (US$37,100) on a purported Australian foreign exchange trading platform lost all the money after the platform and its website was supposedly hacked due to a loophole in the security system.
He then sued a woman who had helped him set up his trading account, claiming that she had perpetuated a fraudulent scheme to scam innocent investors into thinking they were investing with a legitimate company.
However, the court threw out the suit in a judgment made available on Thursday (Nov 30).
The plaintiff, Mr Foo Ching Chee, claimed that he was introduced to a man named Mr Tan Choong Tat, also known as Eugene, around early 2020.
According to Mr Foo, Mr Tan said he was selling investment products for a company called Equity Advisers. Equity Advisers was purportedly an Australian licensed forex trading company headquartered in Melbourne.
Mr Tan purportedly told Mr Foo that he could make substantial profits by investing with him and another woman – Ms Ang Chew Tee, also known as Amy.
Mr Foo claimed that he relied on what Mr Tan and Ms Ang told him and remitted S$4,500 to Mr Tan in April 2020.
After this, Mr Foo said he was given more material about the profitability of Equity Advisers, in order to induce him into investing.
For example, he was told that he would make profits of between 15 per cent to 25 per cent of his investment sum if he invested more than US$10,000, and that any trading loss would not exceed 5 per cent of the investment sum.
According to Mr Foo, Ms Ang also said she was an agent of Equity Advisers and was its Singapore representative.
As a result of what Ms Ang and Mr Tan said to him, Mr Foo invested a total sum of S$49,500 in Equity Advisers.
THE HACKING
On Sep 29, 2020, Mr Foo was informed that his investments and profits with the company were gone. He could not log into his trading account to check his account balance.
A day later, Equity Advisers issued a notice saying that its trading platform and website had been hacked, due to a loophole in the security system.
When Mr Foo managed to access his trading account in October 2020, he saw negative values of his account balance and profits, with other investors appearing to have similar outcomes.
He wrote to the Australian Securities and Investments Commission to find out if Equity Advisers was legitimate, and realised that while there was a company with such a name offering financial services, it was a different company from the one he had invested with.
Mr Foo sued Ms Ang, claiming the sum he had invested, with interests and costs. At first, he also wanted to sue Mr Tan, but did not manage to as Mr Tan was not served with court papers within a certain time frame.
MS ANG’S DEFENCE
In her defence, Ms Ang said she was not an agent or employee of Equity Advisers and never said so to Mr Foo. Instead, she was simply a regular investor who helped others transfer their funds to the company in a voluntary capacity.
Unfortunately, the scheme turned out to be a scam and many investors, including Ms Ang, lost their money.
She was first introduced to the company in February or March 2020 when a friend took her to a presentation by the company.
She said she only got to know Mr Foo through a WhatsApp group chat created by Mr Tan in March 2020. WhatsApp transcripts showed that Mr Foo was already an investor even before he was added to the chat, Ms Ang claimed.
She said she never set out to mislead Mr Foo or defraud him, and that she genuinely believed Equity Advisers was a legitimate company based in Australia providing a live foreign exchange market trading platform.
After news of the hacking incident broke, Ms Ang said she anxiously waited for updates together with the rest of the investors but was left hanging without a plausible explanation.
She said she was also a victim of the scam, suffering losses of S$100,000 including investment accounts under her family members’ names. She said she was “in no way responsible” to Mr Foo for his own losses.
While Mr Foo made arguments on how Ms Ang had filed a police report only after Mr Foo sent her lawyers’ letters, Ms Ang explained that she did not make a report earlier as she believed it would be futile.
At trial, she said: “Frankly speaking, make police report also cannot get … back the money. Why I want to waste time?”
However, she eventually filed a police report to inform the authorities about the incident.
Magistrate Teo Jing Lu found that Mr Foo had not proven his case. Instead, evidence pointed to the “much more probable conclusion” that Ms Ang did not know that the investment scheme was really a scam in disguise.
He dismissed the claim and asked parties to file submissions on costs and disbursements.