Investor accuses stockbroker of fraud

A man yesterday claimed he had been defrauded by his stockbroker and filed a writ of summons requesting the court to condemn Bank of Valletta plc and Travellex Financial Services Ltd to pay him damages.

Salvatore Farrugia claimed in the First Hall of the Civil Court that he had received the sum of £93,943, representing his investments, from Scottish Mutual International plc.

The company had issued him with a cheque drawn on Citibank plc, payable to "Mr Farrugia". The cheque came into the possession of Mark Randon, who was Farrugia's stockbroker.

Farrugia claimed that Randon had decided to defraud him. According to Farrugia, Randon had requested Travellex to cash the cheque and to replace it with two cheques for Lm25,000 and Lm34,589.65.

This transaction was carried out without Farrugia's knowledge or consent.

Foreign exchange bureaux, he said, were prohibited from cashing personal cheques but Travellex had illegally cashed the cheque issued by Scottish Mutual and had, therefore, facilitated Randon's criminal action.

Randon had subsequently retained one of the cheques for Lm25,000 and had cashed the cheque at Bank of Valletta plc by falsifying Farrugia's signature without his consent, Farrugia said.

Farrugia also claimed that Bank of Valletta plc had acted negligently when it had cashed the cheque presented by Randon without verifying the endorsement.

The court was requested to declare that Bank of Valletta and Travellex had acted negligently in Farrugia's regard and to order them to pay him damages.

Dr Shazoo Ghaznavi and Dr José Herrera signed the writ.