A novice trader made £9m after an account he was using to learn how to trade turned out to be active on the open market – and now he’s suing for the profits.
Harouna Traoré, who’s based in France, opened a £17,000 account with British brokerage Valbury Capital after completing a trading course.
The 41-year-old believed he was trading in a dummy account that allow traders to place deals without losing any cash, while mirroring what happens in the real market.
According to reports, it wasn’t until Traoré ran up almost £880m of futures - amassing a debt of more than £880,000 - that he realised he was trading on the open market.
Panicked, Traoré continued to trade hoping to clear his debt, eventually amassing a profit of £8.8m.
“I could only think of my family,” Traoré, who is married with two children, told the FT. “I was stressed.”
Having salvaged his initial investment and turning around a hefty profit, Traoré informed Valbury Capital, who then told him he was in breach of contract and his positions were “void and cancelled”, the newspaper reported.
Traoré is now suing the company for the £8.8m profit he says he earned, citing breach of contract and negligence.
His lawyers say the company’s position is wrong, as Traoré made most of his profits after realising the account was live, and that Valbury had failed to impose any limits.
Robert Falker, the lawyer representing Valbury in the legal proceedings, made the following comments to the FT: “We are familiar with the spurious allegations made by the French arcade trader Mr, Traoré (a seasoned market risk analyst formerly employed by Reuters) which are strongly denied as wholly without merit and will be vigorously contested.”
It is yet to be determined if Traoré case will be heard.