ByramCPA

Essentially yes. Trading program forced a loss sale to which Client never agreed, wiping out all his investment and then some, and then Client realized he had been scammed.

Thank you for the detail, DANRVAN! Client ("the mark") was following buy and sell instructions of two other "investor friends" (who were also leading him on and enticing him to put more money into his Foreign Currency Exchange Account) in a practice the internet apparently refers to as "Fattening and then Butchering the Pig" (gee, how nice the scammers from Asia are!) But Client does have detail of his MetaTrader5 account, and of his buying and selling and contribution history. ForEx, is short for Foreign Exchange or Foreign Currency Trading. This just happened the other day to Client, so this would be an issue on the 2022 income tax return.

This has just happened. Client has well documented what he put in and his date of loss. I suspect the scammers will not send a 1099, however.

Hello, I have a Client who fell for a ForEx currency trading scam, to the tune of many tens of thousands of dollars, on MetaTrader5. As we all know, Casualty and Theft losses have not been a thing from 2017 forward. However, Client DID enter this scam as an investment. Client has documentation of how much he put into the scam and exactly when, and the exact date when the program traders forced a sale on his account and wiped him out. Could his massive losses be treated as investment losses, and allowed to offset gains plus $3,000 a year in lowered income, for many years to come?