About a year before he retired in 2012, top jockey Saimee Jumaat was advised by two financial advisers to place US$620,900 in a foreign exchange trading service run by a company called SMLG.
But there was no return on the investment despite it being capital-guaranteed with 40 per cent profit - until yesterday when the High Court held the two advisers liable to pay back the US$620,900 plus interest from 2012.
Justice Choo Han Teck said financial advisers Moi Kok Keong and Alice Quek had breached their duty of care owed to Mr Saimee by negligently misrepresenting the SMLG investment to him.
The judge also held IPP Financial Advisers, which engaged Mr Moi and Ms Quek as financial advisers, to be vicariously liable for the duo's negligence.
"Saimee is a vulnerable client. He is not highly educated and predominantly relied on Moi and Quek's financial advice," said Justice Choo.
He noted that both were qualified chartered financial consultants who had been working in the industry since 1991.
Mr Moi had introduced a fund manager for SMLG to Mr Saimee in April 2012, and Mr Saimee, on the advice of Mr Moi and Ms Quek, opened a trading account with FX Primus to invest the US$620,900 through SMLG.
But when the first tranche of a payout of US$80,300 together with profits became due in May 2012, both told him SMLG was unable to pay because of a technical glitch in the algorithm.
In September 2012, both advised Mr Saimee, 47, to ink settlement pacts with SMLG for the return of US$711,000, comprising the invested sum and promised returns - but the deals were not kept.
In July last year, he sued both, through lawyers Uthayasurian Sidambaram and Aditya Naidu, for negligent misrepresentation, and IPP for vicarious liability, among other things.
His lawyers argued that both owed a duty of care as they had advised Mr Saimee in their professional capacity as financial advisers.
Lawyers for the duo led by Mr Wilson Tan denied the claims, arguing that the SMLG investment was merely personal advice and Mr Saimee was an experienced investor.
Mr Dominic Chan, defending IPP, argued that Mr Saimee ought to have known such advice was neither official nor professional.
Justice Choo, in rejecting the claims, found the duo had breached the duty of care to Mr Saimee. He said IPP also had to bear vicarious responsibility when financial harm occurred, since it engaged the financial advisers to sell its financial products and thereby created the risk of such advisers committing wrongs against third parties.
Mr Saimee's lawyer, Mr Naidu, said: "The decision has provided closure and justice for our client, who had to go through this ordeal for more than six years."
IPP Financial Advisers said yesterday the "case is about representatives acting outside their scope of professional duty and giving personal advice without the knowledge of the company, for a product which was never approved by the company.
"We would like to reiterate that we have never been in the space of providing advice on forex trading."
