But Chris Robinson, the defence attorney to Saturley, said that the 37 investors who are suing his client were not blind to the risks of the strategies, reported the Chronicle Herald. Robinson pointed to the fact that the largest loss incurred by a single family among the investors was $8 million, suggesting the plaintiffs are not financially naïve people.
He added that fewer than 10 of the plaintiffs have been with Saturley for less than a decade; over half have been his clients for at least 15 years. Each client, Robinson said, signed an investment policy statement, a discretionary trading agreement, and a margin account agreement when they first started working with Saturley.
“Every single one of those clients had as their goal capital appreciation, income generation,” Robinson told the Herald, adding that they had on average specified their own risk tolerances to be above average. “You cannot achieve the first two goals with a low-risk profile … It just doesn’t work.”
He also said National Bank Independent Network should shoulder the blame for being quick to demand that the investors’ margin accounts be paid up.
In the second week of March when the COVID-19 pandemic sent markets plunging, the plaintiffs’ accounts became under-margined; on March 9, the plaintiffs’ accounts held $22 million in all, and were under-margined by $3 million.
