Gain Capital, the internet-based forex trading
platform, has reacted angrily to a $10 million lawsuit filed
against it in New York, saying that the claim is baseless and
factually inaccurate.
The US network, which transacted over $200 billion in volume in
2002, is accused of defrauding clients and knowingly misleading
them about their account performance. The complaint relates to
business that Gain handled in association with Sterling Forex, a
money manager.
The complaint was filed in January by Spencer Rawlins, a
former F-14 pilot for the US Navy. He is just one of the thousands
of retail investors who have been attracted to the healthy returns
that forex funds can offer (see chart). He opened an account
managed by Sterling, and he says he was repeatedly told that his
funds were performing well, even though they had actually lost
about 80% of their value.
Sterling, which cleared its accounts with Gain, has since shut
down and been fined...
