Quitting the UK for a new life in Thailand, an expat was in for a shock
Today, this 60-year-old Brit rarely socializes and relies on a small but generous income from his wife, who works in an IT company, to pay for his extremely modest daily needs.
Derek’s story began a decade or so ago when, like so many foreigners before him, visited Thailand for the first time on a business trip to SE Asia, was taken by the country’s many charms and returned on multiple visits. Back in London, meanwhile, he was going through a divorce.
Along the way, he met someone special and decided to up sticks in the UK and settle down in Thailand with the lady he eventually married.
After selling his house in London and sharing the proceeds with his ex-wife, Derek was left with a substantial amount of money, buoyed by savings and investments. It was certainly enough to fund an agreeable existence in Thailand.
Slowly he built a circle of friends, mostly other expats with Thai wives, joined a few clubs and relished the year-round opportunities that this country’s tropical climate offered, including weekends at the beach and sports like veterans’ tennis and golf.
Despite initial reservations, in case it interfered with their friendship, Derek sought his chum’s advice, given that health problems were becoming more likely at his age. A suitable policy was nevertheless arranged and Derek was happy with the cover, aware that certain commissions were involved.
Unfortunately, Derek soon faced two serious health issues that required costly medical attention. Fortunately, or so he thought, the hospital bills would be covered by the insurance. The first one was repudiated, however, because it was deemed a continuous of an “old injury.” He fared better with the second bill, which was paid more or less in full. When the policy’s renewal came up, the premium had increased by exactly the same amount as the hospital bill for his previous ailment.
Derek was suspicious and started to look into the background of the policy. He dug deep and reckons now that his friend had asked for “extra commission” on that policy renewal. Derek was less than pleased with someone he trusted “implicitly.”
But that was just the start of the dispute that eventually ended their friendship in great bitterness. On his friend’s advice, Derek had invested the biggest proportion of his wealth into a scheme that promised far greater rewards than the one of two per cent he was getting annually on his money in British banks. He was told to expect not less than eight per cent a year, to be paid quarterly, otherwise no deductions form the capital amount would apply.
True to the adviser’s words, Derek received a very health payout at the end of the first quarter. His friend suggested he invest that money into a venture capital company that would give even higher returns. Having seen the positive outcome of the previous advice, Derek readily agreed.
The alarm bells went off, but obviously not loud enough, when Derek was told to pay his investment into the private offshore account of his friend. Naturally curious about this development, he was informed by his great mate that ‘it’s easier that way.’
“I trusted his advice,” said Derek.
Promises of quarterly reports on the investment did not materialize other than a single print-out bearing the name of his friend’s company. Understandably, Derek was growing increasingly unhappy with the situation, especially when his inquiries were met with comments like “things are looking better” and not to worry.
Discovering later that the venture capital company did not exist on any stock exchange, Derek started to challenge the financial adviser - only to be accused of intimidation.
At the end of his tether, Derek approached the Securities Exchange Commission (SEC), the normal arbiter in such disputes, but was told there was nothing they could do. He then went to Economic Crimes Suppression unit of the Royal Thai police who proved more helpful, noting that the financial adviser was guilty on several accounts and had to return Derek’s original investment plus compound interest.
One year on, Derek has not received his investment or any other payments.
Meanwhile, most of his money remained in the first fund his friend had recommended. Told he could withdraw funds at any time, Derek was horrified to learn that a percentage of his money was deducted with every withdrawal. To make matters worse, he also discovered that he was not being told what shares were being bought or sold in that fund and whether commissions of those transactions were going to his advisers. That he had been misled or duped by his one-time best mate was finally and painfully confirmed.
Derek’s wealth today is a fraction of what it was three years. Admittedly, he managed at the outset to get enough of his investments to buy a small house and car. But the returns he had been led to believe simply never appeared, and he is left to wonder how much his now former “friend” benefited by his trust.
Is there a moral to Derek’s story? A confidant and legal expert advises the following: “Where an exchange of money is concerned, even between close friends, close attention to all the details on contract is absolutely crucial. You can't trust anyone."