The client had been sold a great deal of Private Equity before the market collapsed.
Private equity is bought on an installment basis (drawdown of commitment) and the overconfident adviser had not left enough cash available for the cash calls. The client not only lost money but was on risk for al of his assets and had his money tied up for several years..
A detailed report was written outlining what had been done and what should have been done by the adviser. This included a review of what would have been a reasonably competent course of action by the adviser in dealing with this client by reference to the Code of Conduct. The adviser had not followed industry-standard procedures, including know your client cheques – or even account opening documents. It was all done on a handshake. The report also included a quantum of the damages.
The report was defended in Court under cross examination from a Senior Counsel and his team.
The report was tested in Court and the judge accepted the report and Richard Harris as a credible witness. The client was given control of his assets.