Jail for man behind $5 million Ponzi scheme
Shane Richard Scott has been sentenced to four years, eight months’ imprisonment for operating a Ponzi scheme, in a prosecution brought by the Serious Fraud Office (SFO).
Mr Scott appeared in the Auckland High Court today (Friday).
In September he pleaded guilty to four charges of ‘obtaining by deception’, 20 charges of ‘theft by person in special relationship’, one charge of ‘using document with intent to defraud’ (for offending prior to 1 October 2003) and two charges of ‘obtaining by false pretence’ (for offending prior to the same date).
Mr Scott operated a Ponzi scheme with no direct evidence of any legitimate investments.
The scheme involved Mr Scott’s friends and associates. The long-term investors – over a decade for some - believed he had been working on various overseas investments; the short-term investors believed they would receive high returns in relation to property developments and exporting/importing deals.
As a result of Mr Scott’s scheme, they have lost significant amounts of money. Some of the short-term investors received their money back from Mr Scott, but only after extended delays and excuses.
The total of Mr Scott’s offending was about $5.4 million.
“A Ponzi scheme works by using the money provided by later investors to pay out the earlier investors,” says SFO Director, Julie Read. “There was never an intention to invest the money as promised and inevitably the scheme falls over when the new investors’ money is insufficient to pay out ‘investments’ that have fallen due.”
Last updated on the 16th September 2019