Client invested $11,000 with Money Wyze

[nwtaxlady]

Client was looking for a home based business. He saw an ad in the back of a magazine and responded to it. Money Wyze called him up and he invested $11,000 with them. He was told that it was online shopping deal where he would get a % of the sales and that Amazon.com takes care of the shipping etc. He received flyers in the mail along with his paid invoice explaining how it works. Long story short, he never received a dime. He would call them and just get a message. He has documented all his calls and has actual phone records highlighted. Also has told the BBB and they have "MoneyWyze" as a "F" rating. He has also contacted the Attorney General, and also the Office of Inspector General. He has copies of all his corespondance with the above.

So my question is, does he get to take some kind of loss? And if so, what kind?
His intention was to have a "Home based business" , so with that in mind, do you put it on SCH C? Or as I have read somewhere, deduct it as a capital asset loss.

Does anyone have experience with this Money Wyze? If you google it, you will see that it was a Scam!

So does my client get any type of loss, or is he just out of luck?

[Lion]

Did he file a police report?

[nwtaxlady]

I don't believe so.

Did he file a police report?

I don't believe he did. He has done everything else (mentioned in post) but that.

[taxea]

This is theft of services or violation of a contract (if he signed one). He shouldn't claim a loss until he can prove efforts to get the money back. Perhaps a certified letter from an attorney would be a good start along with a police report and a complaint to the FTC.