Detailed calculation and brief justification of my losses.
1 Negligence
While it`s intangible, Etoros negligence, lack of basic care and support, then misinformation and poor management led directly to me depositing more money and effectively loosing more. Had Etoro put suspension or limitations on my trading when they discovered how much I invested in relation to my earnings, I would have not invested anymore. Simplest action was to not allow me to trade leveraged CFD but just x1 real trades (for the record, customer services thinking capabilities are widely questioned on forums). If my positions were not leveraged during pandemic I would not have lost 18,000$ in one week. Moreover, those BTC positions bought at 9,000 would have remained open (as there is no stop loss, not automatic closing of unleveraged positions, even if price crashes to one dollar) and I could sell them today for 18700$ (that’s how much the price jumped since and keeps rising). So I lost 18k but also chance to gain 18k, so if Etoro limited my trades just in one week I could have 36,000$ more.
Etoro knew about my financial situation since August 2019, and I had numerous loosing trades since, and at no point they expressed care, interest or worry, despite having me red-flagged for possible money laundering but not taking notice that many of my funds were loans and credit cards. Etoro had many chances to warn me or limit my trading, but they decided to let me increase my losses (surely bearing in mind that eventually they will close my account and take all those losses as Their profit). So, apart from that one week costing me $36,000, there were many other weeks. Since August 2019 only on x2 leveraged purchases I lost over 40,000$, which would not only break even but actually be in high profit today if Etoro allowed me only x1 trading or limited new deposits.
So, loosely, 40,000$ is my damages due to Etoros various negligence.
- Gross Financial Misconduct
- Manipulation of account statements, calculation algorithms
- Compensation cost of my own positions Etoro estimated on 4,700$, but cost of withholding that information about manipulated figures for 2017-2018 has more direct cost to me (a week of analysing data, doing research, reviewing others account statements, consulting with solicitors and thinking about the issue every free moment, £20 and hour x say 25 hours =500£.
- Real compensation requested is not that of my loss but loss of at least 200,000 others. If we will continue our awareness campaign and pressure authorities, all other users can come forward for their compensation that could amas to estimated $5.6mln reimbursements by Etoro. See evidence(Calculations – estimated compensation owed by Etoro).
- If Etoro cannot guarantee to compensate all users (although we will campaign with the CySEC so that i`s publicly announced and all users accounts are notified, audited and compensated accordingly) we are asking now for 2% of total estimated compensations, to be paid out, which will be distributed among existing and forthcoming 10 users who will have contributed to this research. 2% of 5.6 mln is $112,000
- Incorrect rounding down of profits and rounding up of losses to 1 cent. When one of my profits was 40.398 Etoro accounted not 40.40 but 40.39, costing me effectively 0.8 cent. Etoro would have to confirm which rounding method is used, mathematical when anything above 5 is rounded to 1, or simple, by just cutting of the last digit. It would appear that the latest method has been used which has clear cost implications.
Again, strict effect on my 9524 positions is probably less than 10 dollars, but should all 860,000 active users doing 10 trades each year claim to have their profits paid 0.002 $ less, then on 8.6 mln trades x 0.002= 17,200$. So again, 2 % of that to compensate users that contribute to my blog is 3440$.
- Rounding value of closed positions only to 2 decimal places, even for assets which are only worth 0.00xx, e.g. Tron TRX, resulting in up to 1% losses on assets worth under a dollar and 10% on positions worth less than 10 cents, e.g. TRX=0.0258 but Etoro rounds up it`s value to 0.03 or Ripple XRP close rate 0.22$ which was in fact 0.2249, 0.0044 adding the same difference on open rate gives total difference of 0.0088%==1%
I had 324,708.95946 XRP units x 0.01$=$32,470.89 approx. not paid out in profit to me!
See separate documents with evidence and calculations.
- In only 1136 positions 706 were wrongly calculated. The global effect of 8.6mln trades, each just for 100$, and making 1% profit/loss=8,600,000$. If each profit was rounded up/down 1% potentially $86,000 could be not paid out to customers, or their losses could be that much higher.
- 10% in case of some penny stocks/assets, like XRP above, could mean 860,000 wrongly paid out.
- Again, 2% of $86,000 (and overhaul of Etoro system) to compensate a handful of victims would be $1720.
- Closing of non CFD leveraged 1 position although set at 100% stop loss (as my Bitcoin Cash BCH example), potentially affecting thousands of crypto traders.
My technical loss would be 86$ if compared to today’s price of sell (if I kept the position open). But my case is not isolated , while gathering database of mistreated customers I am finding more with the same situation, and even 1000 of them each losing 50$ could mean 50,000$ in reimbursements. Required compensation is 2% of $50,000= 1000$.
- Breaking of FCA requirements of clear, thorough, error less, financial reports –fines and penalties for Etoro
- APPROPRIATION and not paying out MY CRYPTO ASSETS from
At 4 x value of assets attempted to appropriate – 400×4=1600$
- Misrepresentation
I did not know or understand true risks and even talking to Etoro manager I was not explained that FCA was no good for me as I intended to trade cryptos mainly, and that cryptos are not regulated. Then it turned out that by default I was signed up under Etoro EU, although registering from UK, so I thought I was FCA but instead was CySEC, so FCA (which I relied upon to join the platform, as it was advertised in all reviews) was not even applicable. Even verbal discussion with management resulted in confusing summary email. Had I been plainly explained that Crypto trades are not protected and cannot be discussed with Ombudsman, and if that most important infor was in Etoro adverts, instead “best crypto platform, FCA regulated), from the onset, I would not risk investing with the platform. I believe I would deposit at least 25% less, had I been aware of “no FCA coverage and account can be terminated anytime”
25% x $160000$ deposited=$40,000
- Grooming into higher memberships and SCAM-like behaviour – false feeling of being important and respected, of having special privileges and being looked after. False feeling that nothing can go wrong with the platform or my relationship with them, while secretly waiting until I reach the top (Diamond) status of investments only to terminate my account at earliest opportunity, after my one complaint, ignoring all artificial special status and personal treatment that I seemed to have as seemingly valued member. Again, such Etoros actions increase attachment to the platform and take users guard down, causing users to relax and trade, not questioning Etoros legitimacy and discrepancy in regulations and not looking at third party reviews and most importantly not thinking that Etoros vicious, heartless management can terminate account any time for not even breaking T&C. Damages from this are not easy to measure, but reinforce damages in other claims.
After I discovered real face of Etoro, I started searching, and after a few layers of sponsored articles, I started getting to genuine reviews and shocking stories of mis-treated customers, mostly withholding their money blaming manufactured “technical glitches”, and plethora of of other excuses. Trust Pilot, Reddit, Quora to name a few all show a real scale of Etoros problems, which exist for years and still don`t improve. Again hundreds of print screens available,
Expected effect – fines and penalties for Etoro and cost of regulatory requirements to improve their procedures. Continuous loss of revenue from “aware and genuinely informed” seems unavoidable. Although we don`t want Etoro to be losing money, we expect responsibility and implementation of measurable improvements, which Etoro has a long way to achieve.
- Unjust and pre-mature termination of user account and executing trades against users interest.
- Un-just – no viable reason, not breaking of T&C, unproven and unverified assumption of financial difficulties-only an excuse to get rid of investigative user who starts finding serious problems and suggests to report it to authorities
- Pre-mature- wrong timing, when RSI, momentum, tech and fundamental indicators kept rising
- Execution of trades against users interest (ignoring fundamental and technical analysis) – expected regulatory fines for not complying with trading licence terms
This is a farse – Etoro terminating my account and taking my money, in the middle of bull run (confirmed by Etoro many times in newsletter and supported by fundamental and technical analysis) which Etoro knew about and rushed to close my account before I make higher profits. There is evidence of BTC being in a rising up trend and forecast by investment banks of $30,000 next year, and $36,000 median price based on survey of 1000 by Kraken report Autumn 2020. All this already materialised in BTC going from 10,800 at time my account was closed to 19,200 today, and not even reaching all time high of $20,000.
If my positions were closed today 04/12/2020, not in October my profit would be $70,000 higher. If I could close them in 2021 (as originally planned) while BTC is between 25-30k, selling at 25k (and other cryptocurrencies rising in price proportionally to BTC), my account would be80,116$ in profit. Had I stayed on the platform for another 2-3 years, this figure could be easy over 150,000$. I could settle for $75,000 (for this damage only),which is approximately how much I`d need to break even on my deposits!
Money Etoro made on me:
My legal expenses and my own and my research teams time, and setting up website to find and consult with other users – at least 4000$ so far
Direct and Indirect damages are not easily quantifiable but I`d say it` worth at least 1% of all my claims, at least $2000 to be added to total compensation figure. See claim 9 for details.
MY TOTAL CLAIM FOR DAMAGES
=$40,000 + ($4700+10$+$32,470.89+$82)+ 1600$+$40,000+75,000$+4,000$
=$197,862.89 +(9)
This may appear a lot but remember that I got a Diamon Membership status because I have invested more than $250,000 on the platform, and closed over 1700 manual trades in profit of $160,000, and was acclaimed by Etoro “proficient in my actions and use of platform”, so if they have messed up a Diamond account, the quantifiable damages and losses are of a Diamond level too. Had it not been for over $70,000 in commission/spread/fees, I`d be actually in profit.
If Etoro pays me all requested compensation of $198,000 then they will still be in 220,000-198,000=$22,000 profit!