Investment Losses and Bankruptcy
September 28th, 2006 by Questions
I am in a unique situation.
I used my student line of credit ($100,000) to make investments in stocks. I had made about $150,000 in profit in 3 months.
Unfortunately, I sold (by accident) one of my stocks during a time, when no brokerage house was allowed to trade it (due to a reorganization). But TD Waterhouse cleared the transaction anyways. Only a month later, when they realized their mistake, did they forcefully correct it (for me and 30 other clients in Canada), leaving me with a $120,000 negative cash balance, and holding me fully liable.
Then they froze my brokerage account, and liquidated my $250,000 portfolio for pennies.
Now I still owe $100,000 to TD, and $100,000 to my student line of credit.
I have no other assets or money left.
A lawfirm is interested in helping me sue TD Waterhouse, but I can’t afford it, and fighting a Bank, I’d probably lose anyways.
My questions are:
1. If I declare bankruptcy, will this erase both the debt on my brokerage account AND my student line of credit??
2. Can TD Waterhouse sue me for the $100,000 once I declare bankrupcy?
3. Once I am in bankruptcy, can I still sue TD Waterhouse if someone lends me money to do so?
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