New Zealand Sentences Ross to 10 Years in Jail for Ponzi SchemeMatthew Brockett
New Zealand financial adviser David Ross was sentenced to 10 years and 10 months in jail today for running the nation’s biggest-ever Ponzi scheme.
Ross, 63, was sentenced in Wellington District Court after pleading guilty to eight charges including false accounting and theft, the Serious Fraud Office said in an e-mailed statement. Large portions of client portfolios managed by closely-held Ross Asset Management Ltd. were fictitious and overstated investment positions by more than NZ$385 million ($319 million), the SFO said. The total loss to investors was more than NZ$115 million, it said.
“More than 1,200 client accounts were affected by Mr Ross’s scheme, so his offending has had a devastating impact on many lives,” SFO Director Julie Read said in the statement. “The financial losses are not only significant to those individuals, but they will have a flow-on effect as those investors’ dealings in the New Zealand economy are impacted.”
The SFO and the Financial Markets Authority brought charges against Ross in June, alleging he ran a Ponzi scheme after Ross Asset Management collapsed in November last year.
About 45 New Zealand finance companies failed between 2006 and 2011, according to the report of a parliament inquiry published in October 2011. The failures -- either receiverships or debt moratoriums agreed with investors -- put at risk NZ$6 billion of deposits and affected at least 150,000 people, the report said.