An investment manager (who operated through a company) received funds for investment. Although the money was lost the investor manager continued to report to the investor as if the funds existed until the investor requested to withdraw the funds. The manager did not hold a portfolio management license as required by the Regulation of Investment Advice and Investment Portfolio Management Law, 1995, and did not comply with the provisions of the law regarding the manner of managing the portfolio, but argued that the agreement with the investor stated that the investor is aware of this and waives its rights.
The Court held that one may not contract out of the provisions of the Investment Advice Law and therefore the portfolio manager who held no license and failed to manage the portfolio according to law is personally responsible for the loss of funds. In addition, the manager may not contend that the company is responsible and not him personally due to the fraudulent acts he committed.