A Canadian carpenter’s meteoric rise to wealth and subsequent downfall serves as a cautionary tale for investors. Christopher DeVocht, a self-taught day trader from Vancouver Island, rode the waves of Tesla’s stock market fluctuations, turning a modest C$88,000 into a staggering C$415 million in just two years. However, his fortunes took a drastic turn when Tesla’s stock plummeted in 2022, wiping out his entire net worth.
DeVocht, now in his 20s, claims that the financial advice he received from Royal Bank of Canada and accounting firm Grant Thornton was negligent and failed to account for his limited understanding of financial planning and tax strategies. Despite being a skilled trader, DeVocht alleges that he was misled by professionals who prioritized minimizing taxes over prudent investment decisions.
The lawsuit, filed with the Supreme Court of British Columbia, alleges that DeVocht’s advisors encouraged him to incorporate a company, roll his securities into it, and adopt a strategy of accumulating Tesla shares. This approach, intended to reduce tax liabilities, ultimately led to an “extreme concentration” in Tesla stock, exposing him to significant risks.
As Tesla’s stock soared in 2021, DeVocht’s portfolio surged, but when the market turned, he was left with devastating losses. Desperate to recoup some of the losses, he borrowed C$20 million from his corporation to make shorter-term trades, which only exacerbated the problem. Eventually, his corporation was forced to sell its Tesla holdings to repay loans, leaving DeVocht with nothing.
DeVocht is now seeking damages for breach of contract and negligence, alleging that the inadequate advice he received led to the loss of his entire net worth. His lawsuit serves as a reminder that even the most skilled investors can fall prey to poor financial guidance, and that a thorough understanding of financial planning and risk management is essential for long-term success.
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