Title: Breach of Suitability, Appropriateness, and Informed Consent Duties under FinSA
Author: Joe L. White, Jr.
Date: July 01, 2025
Reference: Conciliation Request – Nexo AG, Canton of Zug
Purpose
To establish that Nexo AG failed to comply with its statutory duties under the Financial Services Act (FinSA) to disclose margin-related risks, assess product suitability, and secure informed consent before exposing retail clients to leveraged financial mechanisms. This annex supports the legal claim of negligent onboarding and deceptive product presentation.
Factual Background
In 2021, I opened an account with Nexo AG through what was represented as a secure, interest-bearing savings and credit platform. At no point during onboarding, documentation, or subsequent use of the platform was I explicitly informed that my assets were being placed in a margin account or exposed to leveraged risk.
No clear or comprehensible disclosure of loan-to-value (LTV) thresholds, margin mechanics, or liquidation triggers was made available. These omissions violate FinSA Articles 8 (duty to inform), 10 (appropriateness), and 12 (suitability) as applicable to retail clients.
Despite significant market gains during the upswing, I made no attempt to take profits or de-risk my portfolio. This was not due to strategy, it was due to lack of understanding that I was operating under a margin framework subject to liquidation. My entire portfolio was eventually liquidated during the downturn.
Claimant Perspective
My background includes direct exposure to the financial crash of 1987 where I developed a lifetime fear of margin accounts after making countless margin calls to customers.
The platform’s presentation, omission of key terms, and absence of interface-based risk indicators led me to believe I was participating in a low-risk, credit-like arrangement. At no point did the system reflect the high-risk mechanics of margin-based liquidation.
Nexo’s platform, language, and omission of key terms like “margin call” and “forced liquidation” contributed to this misunderstanding. I would never have knowingly exposed my lifetime of earnings to high-risk leverage, particularly after personally experiencing the 1987 stock market crash.
Supporting Evidence or Reasoning
- FinSA Articles 8, 10–12: Require disclosure of product risk, client risk assessment, and suitability evaluations prior to onboarding into leveraged or complex instruments.
- Swiss Code of Obligations (CO): Requires performance of contracts in good faith (Art. 2) and prohibits conduct that undermines trust in commercial dealings.
- Unfair Competition Act (UCA Art. 3): Prohibits misleading omissions of material terms in commercial communication.
- Nexo User Interface and Communications: Made no prominent reference to “leverage,” “margin,” or risk-adjusted liquidation thresholds at onboarding or throughout account use.
- Behavioral Inference: Consistent with BGE 133 III 97, behavior inconsistent with high-risk awareness may indicate failure of informed consent.
Statement of Intent
This annex is submitted in support of a good-faith civil conciliation request under ZPO Art. 202–204. The claimant asserts that the conduct described herein warrants regulatory attention and damages due to misrepresentation and unsupervised financial intermediation. No proprietary platform information is disclosed, and all references are based on claimant usage, public materials, and industry guidelines.
Disclaimer
This document is submitted in good faith, based solely on the claimant’s personal experience and publicly available facts. No confidential or privileged information has been disclosed. All statements reflect the claimant’s beliefs or recollections unless otherwise indicated. Names of third parties are anonymized or redacted where not publicly implicated. The purpose of this release is transparency, accountability, and resolution not defamation or harm.
Legal Context Note
This annex was authored solely by the claimant as part of a lawful civil conciliation filing under Articles 202–204 of the Swiss Civil Procedure Code (ZPO). It does not contain any confidential statements made during the conciliation hearing, nor does it disclose settlement terms or other protected materials governed by ZPO Art. 205.
The annex is based exclusively on:
- Personal experience,
- Publicly available information, or
- Facts the claimant is legally entitled to share.
Its purpose is to document the legal and factual basis for the claimant’s grievance, promote transparency, and serve the public interest where legal oversight may be insufficient.
The annex adheres to Swiss privacy and defamation standards under ZGB Art. 28, the Data Protection Act (DSG), and applicable banking/professional secrecy provisions (BankG, StGB Art. 321).
It is not an official court document, and no information disclosed herein was obtained through the hearing process.