- Report: #231823
Complaint Review: RUSFELDT INVESTMENTS LLP - Dickinson, Houston Texas
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RUSFELDT INVESTMENTS LLP
914 FM 517 W. Suite 101 Dickinson, Houston, 77539/ 77058 Texas, U.S.A.
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281-333-5352
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RUSFELDT INVESTMENTS Managed Account scam False advertising and misleading statements led to losing whole account in 2 weeks Dickinson/Houston Texas
I am writing to file a complaint regarding the money management practices of Aden Rusfeldt of Rusfeldt Investments LLC. Mr. Rusfeldt's trading practices in his managed account reduced my $10,000 investment to $407 in 2 and a half weeks (Nov. 21- Dec. 8, 2006). He made false claims in his managed accounts website http://www.forexcapitalinvestor.com/ma/ and also in his advertisement for his 'Managed Accounts' in his course 'Currency Trading Made Easy' (regarding his trading strategy) to which I subscribed in December 2005 .
Note: Evidence below is part of a formal pdf. file presentation I had to submit to a class action law suit against Rusfeldt Invetsments. I can email the full evidence if required.
Compiled evidence below consists of statements from original documents (which can be sent via pdf file). They are:
1. Excerpts from 'Managed Accounts' chapter 5.5 from Currency Trading Made Easy p. 100-102
(attachments 1-3 in original pdf file)
2. Excerpts from 'Important Information' chapter 5 from Currency Trading Made Easy p. 87-88, 90,
93 (attachments 4-7)
3. Misleading statements from Mr. Rusfeldt's 'Managed Account' website
http://www.forexcapitalinvestor.com/ma/ (copy of website attached)
4. Excerpts from Mr. Rusfeldt's 'Trading System Overview & Philosophy' link from his Managed
Account website (unabridged attached).
5. Email communications between Mr. Rusfeldt and me giving evidence of him linking my $10,000
account with his other $30,000 accounts, thereby violating his money management principles outlined in his course.
6. My full Nations Account Statement detailing his trading practices
I have listed a summarized version of evidence from the above regarding his misleading statements and false advertising below.
1. Excerpts from 'Managed Accounts' chapter 5.5 from 'Currency Trading Made Easy,' p. 100-102 (attachments 1-3)
a) I always trade on a less than 5% margin - meaning only a small portion of the account's money is on any
single trade, thus minimizing risk. p. 101
It will be noted here that he repeatedly violated the above in my Nations Account. For e. g. on 11/29/06 at10:01:51am he used 23% on margin. Many times it will be seen that Mr. Rusfeldt used this level of margin, completely violating his statement above.
b) I also always trade with stops in place, so no single loss will do much to the account. p. 101
c) I practice what I preach - and have my own money in the same fund. p. 101
d) Q-Can I lose all my money?
A- By law I have to answer yes, but for that to happen I would have to go on a 6 month losing streak and you would have had to have kept your account with me through it all. I've never had 2 losing months in a row and doubt anyone would stick with me if I lost that long in a row. I'd leave if my stocks or mutual funds lost 6 months in a row. Thats the 1st rule in investing, cut your losers and ride your winners. It would take that long because of the low margin I use and tight stops I place on all trades. p. 102
e) The funds are segregated the whole time, and proper money management and stops are always in place. p. 100
On Dec. 7, 2006 noting my low account balance, I emailed Mr. Rusfeldt under the suspicion that he had linked my $10,000
account with his other $30,000 accounts. He did admit to this in the following email:
Aden wrote:
Yes the 10k number is what is hurting you. The trade size is a larger % on yours then all the other clients. Once I get you up to 10k I must delink you and you will need to call Nations to get your money back. I really must be strict on the minimum for this exact reason.
However he never mentioned to me the strict account minimum when he emailed me offering to take my $10,000 in September, 2006. Nor did he say that he would be linking my $10,000 account with his other $30,000 accounts. Linking a $10,000 account with other $30,000 accounts can hardly be construed assensible money management given his own admission that the linkage was
negatively affecting my account.
2. Excerpts from 'Important Information' chapter 5 from Currency Trading Made Easy p. 87-88, 90, 93 (attachments 4-7)
a) Dont open a full account with less than $20,000. p. 93
Earlier in 2006 he sent an email saying that he had raised the account minimums from $10,000 to $30,000 for his managed accounts. Subsequently I emailed him asking if he knew of anyone who managed $10,000 accounts since that is all I could afford. I never got a response to that email until around September 2006 (many months after I sent the original email), indicating that he was willing to take my $10,000. He never quoted the above to me at that time. Trusting that he was a professional money
manager given all his statements above I unfortunately gave him my $10,000.
b) Never double on a losing position. p. 87
c) Dont risk more than 5-10% of your capital on any one trade. p. 87
d) If you have 5 bad trading days in a row on a real account, go back to a demo account... p. 88
e) Dont let anybody scare you off the Forex by saying it is too risky. Forex is the least risky of all the exchange
based trading. p. 90
3. Misleading statements from Mr. Rusfeldt's 'Managed Account' website
http://www.forexcapitalinvestor.com/ma/(copy of website attached)
a) I trade the same strategies as in my course and daily analysis.
No where in his course or daily analyses did he advocate using 23% margin on a single trade.
b) But I do ask for a 6 month verbal commitment as this is more of a long term investment
He never indicated that his clients could lose most of their investments in two and a half weeks or less.
4. Excerpts from Mr. Rusfeldt's 'Trading System Overview & Philosophy' link from his Managed Account website (unabridged attached).
Rusfeldt Investments LLP Trading System Overview & Philosophy:
Rusfeldt Investments LLP believes in capital preservation first and profits second. Mr. Rusfeldt's fundamental approach to the spot foreign currency market is to be risk averse. Capital
preservation is much more important to portfolio growth than capturing every possible opportunity that presents
itself. That is why on the audited track record you will not see lots of trades each day......
The combination of a statistical signal and a subjective review results in a system which is not black box, but
discretionary.....Risk management and trade discipline are the cornerstones of Rusfeldt Investments trading philosophy.
Adhering to strict risk management guidelines and applying a disciplined approach to the trading system is always applied. The use of hedging is one of Mr. Rusfeldt's best approaches for doing this.....The trading program has a hedging strategy to counter any catastrophic events.....The trading plan is continuously monitored, re-tested, and examined to determine whether or not it continues to be relevant to changing macro market conditions......
After losing several of his client's money Mr. Rusfeldt emailed us saying that we knew it was an'Aggressive account.' However he never mentioned the word 'Aggressive' to me. Before I opened my
account with him I asked him how many accounts he had. This was his response:
'Just two accounts. The hedging and non hedging. They are both manual accounts. The ultra conservative account is referring to the hedging account.'
The two terms he used were 'hedging and non hedging.' Needless to say he still did not adhere to the margin principles advertised for his managed accounts.Mr. Rusfeldt attempts to justify his actions by pointing to the fact that all his clients sign a full risk disclosure agreement (After losing his client's money he said in an email that he cannot be held accountable for being a 'bad trader'). However it should be noted that his clients are deceived into signing the latter by his false statements in his course and website. The risk assumed by his clients would be reasonable if Mr. Rusfeldt adhered to his own trading philosophies and strategies as advertised. I would never have signed the latter nor placed my funds in his managed accounts had I known his actual trading practices. However it will be seen above that he failed to meet the standard.
Mr. Rusfeldt's course is titled 'Currency Trading Made Easy.' In the DVDs included in the course he explains that Forex trading becomes 'Easy' only after one has mastered his trading system. However it will be seen that by losing so much of his clients money, that the title of his course is misleading, and he
himself is unable to protect his client's capital.
End of Summary.
Kavan
West Springfield, Massachusetts
U.S.A.
Note: Evidence below is part of a formal pdf. file presentation I had to submit to a class action law suit against Rusfeldt Invetsments. I can email the full evidence if required.
Compiled evidence below consists of statements from original documents (which can be sent via pdf file). They are:
1. Excerpts from 'Managed Accounts' chapter 5.5 from Currency Trading Made Easy p. 100-102
(attachments 1-3 in original pdf file)
2. Excerpts from 'Important Information' chapter 5 from Currency Trading Made Easy p. 87-88, 90,
93 (attachments 4-7)
3. Misleading statements from Mr. Rusfeldt's 'Managed Account' website
http://www.forexcapitalinvestor.com/ma/ (copy of website attached)
4. Excerpts from Mr. Rusfeldt's 'Trading System Overview & Philosophy' link from his Managed
Account website (unabridged attached).
5. Email communications between Mr. Rusfeldt and me giving evidence of him linking my $10,000
account with his other $30,000 accounts, thereby violating his money management principles outlined in his course.
6. My full Nations Account Statement detailing his trading practices
I have listed a summarized version of evidence from the above regarding his misleading statements and false advertising below.
1. Excerpts from 'Managed Accounts' chapter 5.5 from 'Currency Trading Made Easy,' p. 100-102 (attachments 1-3)
a) I always trade on a less than 5% margin - meaning only a small portion of the account's money is on any
single trade, thus minimizing risk. p. 101
It will be noted here that he repeatedly violated the above in my Nations Account. For e. g. on 11/29/06 at10:01:51am he used 23% on margin. Many times it will be seen that Mr. Rusfeldt used this level of margin, completely violating his statement above.
b) I also always trade with stops in place, so no single loss will do much to the account. p. 101
c) I practice what I preach - and have my own money in the same fund. p. 101
d) Q-Can I lose all my money?
A- By law I have to answer yes, but for that to happen I would have to go on a 6 month losing streak and you would have had to have kept your account with me through it all. I've never had 2 losing months in a row and doubt anyone would stick with me if I lost that long in a row. I'd leave if my stocks or mutual funds lost 6 months in a row. Thats the 1st rule in investing, cut your losers and ride your winners. It would take that long because of the low margin I use and tight stops I place on all trades. p. 102
e) The funds are segregated the whole time, and proper money management and stops are always in place. p. 100
On Dec. 7, 2006 noting my low account balance, I emailed Mr. Rusfeldt under the suspicion that he had linked my $10,000
account with his other $30,000 accounts. He did admit to this in the following email:
Aden wrote:
Yes the 10k number is what is hurting you. The trade size is a larger % on yours then all the other clients. Once I get you up to 10k I must delink you and you will need to call Nations to get your money back. I really must be strict on the minimum for this exact reason.
However he never mentioned to me the strict account minimum when he emailed me offering to take my $10,000 in September, 2006. Nor did he say that he would be linking my $10,000 account with his other $30,000 accounts. Linking a $10,000 account with other $30,000 accounts can hardly be construed assensible money management given his own admission that the linkage was
negatively affecting my account.
2. Excerpts from 'Important Information' chapter 5 from Currency Trading Made Easy p. 87-88, 90, 93 (attachments 4-7)
a) Dont open a full account with less than $20,000. p. 93
Earlier in 2006 he sent an email saying that he had raised the account minimums from $10,000 to $30,000 for his managed accounts. Subsequently I emailed him asking if he knew of anyone who managed $10,000 accounts since that is all I could afford. I never got a response to that email until around September 2006 (many months after I sent the original email), indicating that he was willing to take my $10,000. He never quoted the above to me at that time. Trusting that he was a professional money
manager given all his statements above I unfortunately gave him my $10,000.
b) Never double on a losing position. p. 87
c) Dont risk more than 5-10% of your capital on any one trade. p. 87
d) If you have 5 bad trading days in a row on a real account, go back to a demo account... p. 88
e) Dont let anybody scare you off the Forex by saying it is too risky. Forex is the least risky of all the exchange
based trading. p. 90
3. Misleading statements from Mr. Rusfeldt's 'Managed Account' website
http://www.forexcapitalinvestor.com/ma/(copy of website attached)
a) I trade the same strategies as in my course and daily analysis.
No where in his course or daily analyses did he advocate using 23% margin on a single trade.
b) But I do ask for a 6 month verbal commitment as this is more of a long term investment
He never indicated that his clients could lose most of their investments in two and a half weeks or less.
4. Excerpts from Mr. Rusfeldt's 'Trading System Overview & Philosophy' link from his Managed Account website (unabridged attached).
Rusfeldt Investments LLP Trading System Overview & Philosophy:
Rusfeldt Investments LLP believes in capital preservation first and profits second. Mr. Rusfeldt's fundamental approach to the spot foreign currency market is to be risk averse. Capital
preservation is much more important to portfolio growth than capturing every possible opportunity that presents
itself. That is why on the audited track record you will not see lots of trades each day......
The combination of a statistical signal and a subjective review results in a system which is not black box, but
discretionary.....Risk management and trade discipline are the cornerstones of Rusfeldt Investments trading philosophy.
Adhering to strict risk management guidelines and applying a disciplined approach to the trading system is always applied. The use of hedging is one of Mr. Rusfeldt's best approaches for doing this.....The trading program has a hedging strategy to counter any catastrophic events.....The trading plan is continuously monitored, re-tested, and examined to determine whether or not it continues to be relevant to changing macro market conditions......
After losing several of his client's money Mr. Rusfeldt emailed us saying that we knew it was an'Aggressive account.' However he never mentioned the word 'Aggressive' to me. Before I opened my
account with him I asked him how many accounts he had. This was his response:
'Just two accounts. The hedging and non hedging. They are both manual accounts. The ultra conservative account is referring to the hedging account.'
The two terms he used were 'hedging and non hedging.' Needless to say he still did not adhere to the margin principles advertised for his managed accounts.Mr. Rusfeldt attempts to justify his actions by pointing to the fact that all his clients sign a full risk disclosure agreement (After losing his client's money he said in an email that he cannot be held accountable for being a 'bad trader'). However it should be noted that his clients are deceived into signing the latter by his false statements in his course and website. The risk assumed by his clients would be reasonable if Mr. Rusfeldt adhered to his own trading philosophies and strategies as advertised. I would never have signed the latter nor placed my funds in his managed accounts had I known his actual trading practices. However it will be seen above that he failed to meet the standard.
Mr. Rusfeldt's course is titled 'Currency Trading Made Easy.' In the DVDs included in the course he explains that Forex trading becomes 'Easy' only after one has mastered his trading system. However it will be seen that by losing so much of his clients money, that the title of his course is misleading, and he
himself is unable to protect his client's capital.
End of Summary.
Kavan
West Springfield, Massachusetts
U.S.A.
