I sell stock investment education and coaching to clients. An average client pays me around $1000 for coaching. To sell/convince the clients I show them my past investment history of my online broker accounts. The investment history is accurate within the broker account, but the client assumes real money was used, which is not true. Virtual funds were used for these investments. If I do not disclose or tell clients that the investment history was achieved using a DEMO account with virtual funds, can I get in trouble for this? Is this any form of wire fraud or false pretenses or anything like that?
1 Answer from Attorneys
If you show a potential client your portfolio, but fail to disclose that you were not using your money, or "real" money, you are guilty of making fraudulent misrepresentations to a potential client because you are misleading the potential client into believing that you risked your money in making these investments.
Best of luck,