MAJOR CONCERNS WITH GARRETT KNIGHT ASSOCIATES
These concerns are based primarily on email communications between myself and GKA, telephone discussions, and logical deduction.
(a) Were any shares ever bought?
I have no way of knowing if the various trades were ever made! Do the 'trade confirmations' represent actual investments on the NASDAQ stock exchange, or are they just pages that were emailed to me as ‘proof’? Because most of the trades GKA supposedly made on my behalf were tacked onto much larger blocks of shares supposedly made on behalf of their ‘institutional clients’ there is no way I can confirm if shares or warrants were ever bought or sold on my behalf! All I have is their ‘trade confirmations’ and their ‘word’. But the hard truth is that they have never sent one $ back to my South African account.
(b) 100% + 1% is more lucrative than 1%
All Garrett Knight ask from their clients is 1% commission every time they buy or sell shares on behalf of their clients. In my case they reduced this commission on some trades, and even charged no commission in some cases.
The various commissions they earned may be seen in column 11 (BUY) and column 12 (SELL) of table 1 below, totalling $4,169.
If on the other hand GKA never made any trades on my behalf, and instead issued ‘trade confirmations’ for trades that were never made, then they have made a total of $64,026 from all the funds I sent to them – see column 5 below. Clearly the latter is a lot more lucrative!
Is this a betrayal of trust? Of the worst order! Is it fraudulent? Criminally so! But unfortunately it happens all the time in this sick world we live in!
(c) Fictitious names?
The individual GKA brokers that had dealings with me (David Morgan, Adam Manning, Robert Knight (director), Ian Feldman, Mike Gordon) do not exist when I google their names. One would expect brokers of reputable companies to welcome being known to increase their exposure and investment profile. On the other hand, when I google my own name (and there is nothing special about me), or the names of my friends, there is quite a lot said about each of us on Google. So I must ask the question: Are these real names or made up names? Perhaps a more relevant question is “why would anyone use a fictitious name”?
(d) Concealed Identification
GKA brokers will not Skype nor send you a copy of their passports. There is therefore no way to match their faces with their names to see if their names are real.
(e) No Registration
GKA is not registered with the SEC (USA) or with the FSB (SA) nor any other organization that might monitor their activities.
(f) False Repatriation Promises
To make the final investment I had to borrow to the hilt from every available source, which was far past my comfort level. To encourage me GKA (Robert) made promises of repatriation on eight different dates:
15th April 2016: "I will instruct the Financial Controller to send you 40K after settlement to satisfy your needs in South Africa". See appendix 16, RHS.
18th April 2016: "I would need only 5 days from the date of clearance to be able to send the 40K back to you and have it cleared in your account." See appendix 18, LHS.
19th April 2016: "I have explained everything to the Controller and he has told me he will take care of your transfer back the same day your transfer clears". See appendix 18, RHS.
20th April 2016: "I have instructed the accounting department that as soon as your transfer copy comes in to begin processing the short sale in order to have your account settled in cash". See appendix 19, middle.
20th April 2016: “If you can do it (the transfer) Friday or Saturday it would be good timing to settle either Tuesday or Wednesday once your payment clears”. See appendix 19, RHS.
25th April 2016: "Please find the short sale on VA for your records. This we’ll settle in cash as soon as your payment is confirmed. Once it has I will confirm the transfer to you and then put the balance into YHOO". See appendix 21, middle.
26th April 2016: "I will give the signed confirm and transfer copy to the Controller first thing in the morning. Once the funds clear I will sell (send) you the completed sale copy of the short sale to settle in cash". See appendix 22, RHS.
4th May 2016: "Good news! Your payment has cleared. I’m beginning to settle the trade tonight and tomorrow morning”. See appendix 27.
These promises all came to nothing when on 9th May 2016 GKA (Robert) informed me that there were warrants to the amount of $75,000 attached to the 5th shares. He therefore sends a trade confirmation showing that I need to find $75,750 (incl. GKA’s 1% commission) -
So for a whole month GKA knows nothing about the VA shares being encumbered by warrants, but a few days after they receive my payment for the 3000 VA shares the warrants surface! Give me a break!
(g) No Due diligence
Even assuming that (a) the VA shares really were bought on my behalf, and (b) that the VA share really were encumbered by warrants, GKA (Robert) should have done a due diligence before they offered me the 3000 VA shares. They knew that I would be stretched to breaking point to pay for the 3000 VA shares, and indeed it took me a whole month to raise the funds from numerous sources, even taking out a sizeable loan at 33% pa interest. But rather than doing the due diligence at any time during the month of April, instead GKA was there encouraging me every step of the way to borrow funds, and always assuring me that as soon as they received the payment they would repatriate $40,000 a few days later.
(h) Staggering growth?
The ‘trades’ GKA made on my behalf (see table 1 above) resulted in staggering growth (or so it seemed according to the ‘Trade Confirmations’ they sent me) so that with their careful coaching and persuasion I was willing to cash in my life’s savings and maximise my borrowings thinking that my money was multiplying at an astounding rate. The questions I should have asked are: “Are the trade confirmations, invoices, and receipts real or just pure fabrication? Was even a single share ever purchased?”)
(i) Fictitious and Unlawful consulting fees?
A South African is allowed a ‘single discretionary allowance’ of a million rands to send out of the country each year, which may be used for any legal purpose abroad, including for investment purposes. This presents a problem for GKA where a South African who reaches this ceiling has more to ‘invest’ with them in a given year. But GKA have devised a method for overcoming this limitation. They send their client a fabricated ‘invoice’ (see appendix 31, RHS) for fictitious ‘services rendered’, for example ‘consulting’. In this way prospective clients can send more money out the country on the guise of paying the fabricated invoice. They claim that this is ‘completely legal’ (see appendix 30, third email), but I doubt the South African Reserve Bank would agree! Accordingly GKA is aiding and abetting South African citizens to become law breakers, who could end up in jail as a result.
(j) Option 2
Garrett Knight will not honour their ‘Option 2’ offer (see below) made on 5th September, 2016 (see appendix 53, LHS), and which I accepted on 6th September, 2016. (According to Contract Law when one party makes an offer to a second party, and the second party accepts the offer, then this offer is binding on both parties).
(k) Doubtful Premises
Is the premises shown in the GKA website merely a small rerouting facility for incoming and outgoing telephone calls so that it appears that calls that one makes are going to brokers in Tokyo and likewise calls that are received are coming from Tokyo, whereas in reality they are just being re-
From the final email I sent GKA (appendix 59), which they never responded to, it seems that they would prefer that no visit is made by someone I know in Japan to their Tokyo address on their website, and that no voice-
Conclusion
I have tried to set out the major concerns I have with GKA that come to mind – and perhaps not all my fears are founded.
However when the cumulative evidence presented here is weighed, it seems beyond reasonable doubt that GKA are a fraudulent operation who by lies and deception have tricked me into liquidating my available investments and reserves, maximizing my borrowings, and transferring all to them.
May the Lord have mercy on their souls – but may justice be done!
