What would you do ?

[LS1Z28]

There's a moral battle going on in my mind.

A friend of mine. One of the best, if not the best.
,,Saved my ass'' multiple times. So the trust is strong.

He has this money.
(5 digits in cash)

The money isn't from drugs, prostitution or other dark activities, it was made through his hobbies in the last 10 years.
(nothing to hide, he was reselling/flipping desktop computer hardware parts & accessories & all of those were acquired in legal ways)

But ( there's always a but... ),

- he haven't paid a single coin of taxes, from those profits & activity itself.


Here's the question :

in my place, would you take it & invest it ?

( hes willing to give it, actually the offer came from him, but, i would have to do that via my account )

Benefit for me - 20% of the profits.




Thanks for replies.

Morality is a sliding scale that varies greatly from person to person. Very few things are black & white, most are different shades of gray. I wouldn't have a problem with this scenario from a moral standpoint. His tax issues are between him & the government. But I wouldn't want to take on the risk of someone else's capital if I thought there was a chance it could get tied up with legal issues. The last thing you want is to have your account frozen.

I'm not familiar with laws outside of the U.S., but you might be able to open a brokerage account in his name and help him manage it. He could simply pay you a management fee, and that would provide you with some safety in the event that he runs into legal trouble. That might be something to consider.

You might also want to consider the implications of investing a close friends money. You never know what might happen, and a lot of good relationships are ruined by money. Good luck. I hope it works out for you.

 

[Nobert]

General life lessons:
1. If it is too good to be true, don't do it.
2. If it doesn't pass the smell test, don't do it.
3. If you cannot sleep nights, don't do it.

Should be shown if full screen with capital latters , before agreeing on opening brokerage account and placing signature on marriage papers.

The fact that you worried about the situation, you have to come to an anonymous forum asking us anonymous ETers,

It's the best place to go for, with a question like that. Lots of experienced folks with same interest.

..
means you are not comfortable with it and the arrangement.
Someone who cheats the Government may one day cheats on you.

Yes, there could a correlation in that. And i had similar thoughts too, but in the past.
He could worry about me cheating as well. In fact much more. Still, i mentioned that we trust each other, and the only morals that i were worried about, were my own.

@BlueWaterSailor had good comparison , with Dalai-Lama, so that depends very much on each ones personality traits.
(btw, Blue, i had an AB category myself, used to steer 600 feet DFDS ferries )



@Overnight & @raVar you're both right at the same time, each of you has a very important point to address.

If i would go for it, i would have to think about the potential negative effects on our friendship, as you stated @Overnight ;

even if we would agree upon 20% max of his capital draw down, the reaction could be completely different, once a man would see those 20% gone in reality.

Had another friend, who had $30 k, lost himself $400, went nuts
(that's bit more than 1%...)

& as @raVar said, through his first-hand real life experience, risk management should be applied to the situation itself.

Yes, in the end, those 20% of gains from profits - is it worth it, the potential risk with law enforcement, life long record in their black lists.


I wrote previously guys, that, the hour later, from when i started this tread, i received a good job offer, which will allow me, to start saving capital on my own, once more.

So my friends money, will have to wait for undefined period.

you might be able to open a brokerage account in his name and help him manage it. He could simply pay you a management fee, and that would provide you with some safety in the event that he runs into legal trouble. That might be something to consider.

That's the most appropriate way. Lowest risk.









I think that's it.

I will not take that cash. Got a new job from Monday. Will be back on saving, clean capital in no time.

The next time we speak about his money, i will link him this tread.

Thanks to everyone for answers.

 

[ironchef]

Go ahead and feel free to define, say, the character of the Dalai Lama. After all, he's opposed to the current government of his native land... does this mean he's a liar and a cheat? I'd be perfectly happy to give you lots of other examples if you don't like that one.

I do appreciate your point of view. We each needs to do what we believe is right. What is right for me may not be right for you.

As someone else said very well, this is not a black and white issue, there are shades of gray when it comes to morality.