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We made a bad investment through our financial advisor. We

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gave him money to invest...
We made a bad investment through our financial advisor. We gave him money to invest in Mexico property. We have no equity stake in it. We were promised a return of 10%. I believe it was just a promissory note. He will probably going bankrupt and is being investigated if not already charged with some sort of securities fraud. There were many of us that have invested in this, amounting to millions of dollars. We have received letter from the company stating that he has found someone to take over the project and asking us to sign a new promissory note with them, claiming that the "new" property is twice as valuable as the old property. He claims that the other investors have already signed over 16 million dollars to this new company. We figure we have no hope of recovering our money where it is now (about 90k). We also are wondering whether this would relieve him of liability and keep him out of jail. We also figure there is little hope of recovering anything even with the new agreement... We made a bad investment through our financial advisor. We gave him money to invest in Mexico property. We have no equity stake in it. We were promised a return of 10%. I believe it was just a promissory note. He will probably going bankrupt and is being investigated if not already charged with some sort of securities fraud. There were many of us that have invested in this, amounting to millions of dollars.
We have received letter from the company stating that he has found someone to take over the project and asking us to sign a new promissory note with them, claiming that the "new" property is twice as valuable as the old property. He claims that the other investors have already signed over 16 million dollars to this new company.

We figure we have no hope of recovering our money where it is now (about 90k). We also are wondering whether this would relieve him of liability and keep him out of jail. We also figure there is little hope of recovering anything even with the new agreement but if there is 16 million being moved to the new venture....maybe?

Looking for any advice.
Submitted: 6 years ago.Category: Business Law
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2/1/2011
Business Lawyer: Law Educator, Esq., Attorney replied 6 years ago
Law Educator, Esq.
Category: Business Law
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Signing a new agreement on top of a bad one is not going to be the prudent thing to do here. Signing the new agreement is not going to keep him out of jail of prevent criminal charges. As far as the new venture, you need to get an actual investigator in Mexico to go review the property and also you need to inspect the financial prospectus because it is likely another scam involved from what you describe. You are also correct that you may not ever see the money, but the good thing is that because it is fraud involved the bankruptcy court would not likely discharge the debt.


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