Lost Money in Mars FX? How Investors May Recover Losses From the Advisor Who Sold It

Mars FX was a hedge fund founded in 2020 and operated through Novus Capital Partners out of the Los Angeles area. It marketed itself on a track record that, in hindsight, contained one of the oldest warning signs in finance: reported average annual returns of roughly 19% with virtually no losing months. The fund described a long-short strategy in currencies and gold and promoted stable, consistent gains with limited risk. Investors are now learning about the significant Mars FX losses that have occurred.

According to court filings and news reporting, the fund entered bankruptcy in early 2026, and investigators are now trying to trace approximately $600 million in investor money. Reporting indicates that funds allegedly moved through accounts in the United States and Hong Kong before reaching an offshore entity, and that the fund’s longtime auditor has been sued by investors who say obvious fraud risks were missed. Federal and state authorities — including the FBI and prosecutors — have reportedly opened inquiries, and civil lawsuits alleging fraud, forgery, and money laundering have been filed in multiple countries. The investigations are focused on the significant Mars FX losses incurred by investors, highlighting the serious implications of these Mars FX losses.

Why waiting for the bankruptcy or criminal case usually isn’t enough

As the situation unfolds, it is crucial for investors to understand the implications of the Mars FX losses and what actions they can take to recover their investments.

Understanding the Mars FX losses is crucial for investors seeking to navigate the aftermath and potential recovery strategies.

When a fund collapses, investors understandably watch the headlines and hope the missing money turns up. It rarely works out that way, for a few reasons:

• Bankruptcy estates are often empty or deeply underwater. If hundreds of millions of dollars are genuinely missing, there may be little left to distribute, and any recovery can take years and return cents on the dollar.
• Criminal cases compensate the public, not necessarily you. A criminal prosecution can result in penalties or prison time for wrongdoers, but restitution to individual investors is uncertain and slow.
• The people who took the money may be judgment-proof. Even a winning civil judgment is worth little against defendants who have hidden or dissipated assets.

This is why experienced securities attorneys look in a different direction: the professional who recommended the fund in the first place.

If your financial advisor or broker recommended Mars FX, you may have a separate claim

Here is the point most Mars FX investors miss. The fund’s collapse and the advisor’s conduct are two different things. Even if the fund’s money is gone, the broker-dealer, registered investment adviser (RIA), or financial advisor who sold you Mars FX has independent legal obligations — and their firm typically carries assets and errors-and-omissions insurance that can actually pay a recovery.

Many investors are still grappling with the ramifications of their Mars FX losses and how that impacts their financial future.

A claim to recover Mars FX losses from your advisor may arise from several types of misconduct:

Unsuitable recommendation and Regulation Best Interest

Brokers must have a reasonable basis to believe a recommendation is in the customer’s best interest under the SEC’s Regulation Best Interest (Reg BI). A high-risk, illiquid private hedge fund is not appropriate for many investors — particularly retirees, conservative investors, or anyone who needed access to their money. If Mars FX did not fit your risk tolerance, time horizon, and objectives, the recommendation may have been unsuitable.

Failure to conduct due diligence

Before recommending a private fund, a broker or advisor has an affirmative duty to investigate it — to understand its strategy, vet the principals, and confirm the investment is what it claims to be. Returns of roughly 19% per year with no down months are a textbook red flag that should have prompted hard questions. Failure to perform reasonable due diligence on Mars FX may itself support a claim.

Breach of fiduciary duty

Registered investment advisers owe their clients a fiduciary duty — the highest duty of care, including a duty to act in the client’s best interest and to disclose conflicts. If an RIA steered you into Mars FX while collecting fees, ignoring red flags, or failing to diversify your account, that may be a breach of fiduciary duty.

Failure to supervise and “selling away”

Brokerage firms must supervise their representatives. If an advisor sold Mars FX without proper firm approval or oversight — sometimes called “selling away” — the firm may still be liable for failing to detect and prevent it.

Misrepresentation, omission, and overconcentration

If your advisor misrepresented Mars FX’s risks, glossed over the absence of independent verification of its assets, or overconcentrated your portfolio in a single high-risk product, those facts can each strengthen a recovery claim.

How investors recover Mars FX losses: FINRA arbitration and other forums

Most disputes between investors and FINRA-registered brokers or firms must be resolved through FINRA arbitration rather than in court. FINRA arbitration is generally faster and more streamlined than litigation, and the panels are familiar with industry standards.

The role of brokers in the context of Mars FX losses must not be overlooked as investors seek justice.

The process typically begins with a Statement of Claim that frames the dispute, your background and objectives, what your advisor did wrong, and the losses you suffered. Because the brokerage firm will be represented by experienced defense counsel, how that claim is drafted and presented can significantly affect the result. Claims involving registered investment advisers may instead proceed in court or in another arbitration forum, depending on the agreements you signed.

Many investor-side securities firms, including Bakhtiari & Harrison, handle these cases on a contingency fee basis, meaning you generally do not pay attorney fees unless there is a recovery. Initial consultations are confidential and free.

Who should speak with a securities attorney about Mars FX

Investors affected by Mars FX losses should assess their situation with professional help to understand their options.

You should consider having your situation reviewed if any of the following apply:

Many feel overwhelmed by the scope of their Mars FX losses and the complexities involved in recovery.

• A broker, advisor, or RIA recommended or sold you Mars FX (or a related Novus Capital Partners offering).
• You were told Mars FX was safe, steady, or low-risk.
• A large portion of your portfolio, retirement account, or trust was placed in the fund.
• You are a retiree or senior investor and the fund was a poor fit for your needs.
• You relied on your advisor’s assurances and were not told about the risks or the lack of independent verification of the fund’s assets.

Why time matters

Securities claims are subject to eligibility rules and statutes of limitations. FINRA arbitration generally has a six-year eligibility window, and various statutes of limitations can run sooner. Evidence also gets harder to gather as time passes and as more investors come forward. The practical takeaway: if you lost money in Mars FX, the time to have your claim evaluated is now, not after the bankruptcy or criminal proceedings wind down years from today.

Consequently, the urgency to address Mars FX losses cannot be understated.

How Bakhtiari & Harrison helps Mars FX investors

Bakhtiari & Harrison is a securities law firm based in Los Angeles, California, that represents investors nationwide in claims against brokers, financial advisors, registered investment advisers, and brokerage firms. We focus on recovering investment losses caused by professional misconduct — unsuitable recommendations, inadequate due diligence, breach of fiduciary duty, and failure to supervise.

If you were sold Mars FX by a financial advisor or stockbroker, we will review your situation confidentially and at no charge, explain whether you may have a claim, and handle qualifying cases on a contingency fee basis.

We are dedicated to helping clients navigate the challenges posed by their Mars FX losses.

Contact Bakhtiari & Harrison today for a free, confidential case evaluation.  The sooner we review your situation, the sooner we can advise you on protecting your rights and pursuing

Your recovery from Mars FX losses starts with a conversation about your rights.

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