Readers' forum : Out of pocket

I have a client who acquired some land in Spain using an agent appointed to act for him under a power of attorney. The agent sold the land and retained the proceeds. My client has now enquired about claiming a loss for tax purposes based on the sum invested which was misappropriated.

My view is that the loss he is defining as the sum invested is a debt but not a debt on a security and therefore not allowable for capital gains tax purposes.

It occurred to me that the capital gains tax position would centre on the sterling equivalent of the difference between the price paid for the land and the proceeds received by the agent under the power of attorney. So any profit could result in a charge to capital gains tax without relief for the proceeds misappropriated. Are there any problems at this late stage...