On 18 August 2010, in the Weekly Observer Newspaper, Patience Akumu wrote, in an article titled "Online forex trade: a gamble or goldmine?" "Louis Majwala, who admits to leading a relatively comfortable life thanks to forex trade, is a good example of how you can turn your life around just by buying and selling forex."
Fast forward to 3 February 2011- the same paper carried a story titled "Ugandans lose Shs 11bn in forex scam" showing that over 300 Ugandans are trying to recover $4.5m from Mint Consult, which is owned by Louis Majwala's. The article states "A task force representing the interests of the duped clients has already attached assets belonging to Louis Majwala, the boss at Mint Consults Limited. However, the value of the attached assets – two car log books and a land title to roughly 20 acres of land outside Kampala – does not come close to what the clients are seeking."
The position of trader, created an implied trust between Louis and each client and imposed the following fiduciary duties on him
1. To act prudently/diligently and with reasonable care
2. To act impartially and avoid conflicts of interest
3. The duty to put the investors first and not to unfairly benefit from the trustee position
4. The duty to segregate his personal funds from the funds under management and provide accountability to the clients
5. The duty to provide information in a timely basis
6. The duty to preserve the confidence of beneficiaries
In the end, Louis breached each and every one of his fiduciary duties and it is said he created a ponzi scheme. I expect that he'll be bankrupt and probably in prison for fraud and obtaining money by false pretences soon (as a disclaimer-Louis is innocent unless/until proven guilty).
In an ironic twist, Louis says he can recover the money if investors give him $2m dollars more. I would be very surprised if the "duped clients" who were eager to give him their money last year give him one shilling.
