Alleged fraud on a trading platform

After a big night out, Ivan woke up to discover his phone and credit card missing. Ivan remembered which pub he was last at, so went back the following day. When he checked his phone, he discovered that someone had used his credit card to transfer $5,000 onto an account with a trading platform and had been trading contracts for difference (CFDs) the previous night.

Ivan immediately complained to the trading platform, his bank, and the police.

The trading platform reversed the remaining balance in Ivan’s account, about $2,200, back to his credit card. However, the trading platform said that their systems had not contributed to Ivan’s loss. The account had been properly set up two years earlier, and that the same phone used to set up the account was used to conduct the trades.

In the interests of resolving the complaint the trading platform offered Ivan half his loss, about $1,400. Ivan did not accept the offer and complained to FSCL.



Ivan said he did not know anything about trading platforms or trading CFDs. Ivan said he had not bought his phone until December 2018, but the account had been set up in May 2018. It was Ivan’s view that the trading platform’s records were unreliable, noting that the records showed his gender as ‘female’ when he is ‘male’. Ivan was adamant that someone had stolen his identity and fraudulently used his credit card and phone.

The trading platform replied that their records are reliable. Clients self-select gender and while other identifying information is verified, as gender can be a matter of personal choice, it is not used as part of identifying clients.



It was our view that it would be very unlikely for a person to set up a fraudulent account two years before deciding to use it to steal from Ivan. We also would have expected the money to have been transferred out of the trading platform account, somewhere beyond Ivan’s reach, before allowing the phone to be recovered. We noted that the trading platform’s records showed that the same phone was used to set up the account and make the trades.

Although Ivan submitted that the trading platform’s records were unreliable, we do not have the ability to audit computer records. We accepted the information supplied by the trading platform and were satisfied they had not caused Ivan a loss.



We told Ivan that we thought the trading platform’s offer was reasonable and he should accept it. Ivan accepted our view and the complaint was resolved.


Insights for consumers

If you are going to get involved in trading, make sure you understand what you are doing as they can carry considerable risk.