“With $1 mill, we can make $5 mill a year easy and safely.”  

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Easy, safe ways to generate a 500% p.a. ROI? Sign me up!  

This representation, and other similar ones, recently came before the Court.   The plaintiffs – a natural person resident in the US, two impecunious Australian corporations, and two Canadian companies – pursued the defendant, a natural person.  

The plaintiffs transferred USD$2.24M to the defendant for him to invest. The defendant returned USD$1.33M. In the difference lies the claim.  Our defendant wanted the plaintiffs to provide more security (having already provided $60K) for his costs if he won and obtained a costs order.  

The defendant already had enough to pay the costs of enforcing his costs order (if he got one) in the foreign jurisdictions: [22]. That of itself was reason to refuse the application.  

The application was made “late in the day” and after working through the various limbs of the claim the court concluded at [82]: the defendant’s prospects of getting a costs order are so low that they do not justify an order for security.  

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“We won’t lose it,” the defendant advised: “we are totally risk free.”: [46]   Not true, at least for this application.