Two people who operated a Ponzi scheme for years have finally pleaded guilty after the corporate watchdog cracked down on the initial scheme in 2008, which used more than $30 million worth of funds from investors.
The latest crackdown comes just a few weeks after the Federal Court slammed three other Ponzi scheme operators with fines worth $200,000.
Last week, Brian Wood, of Davistown, and Jimmy Truong, of St Johns Park, pleaded guilty in a Sydney Local Court to operating a Ponzi scheme under the name “Integrity Plus Fund”.
Both of them had told investors their investments would earn returns of 4% per month, and that the capital amounts making up the investments were guaranteed.
Between December 2004 and December 2007, the Australian Securities and Investment Commission says the Integrity Plus scheme raised more than $30 million from 270 investors. ASIC obtained injunctions against the trio operating the scheme, with a liquidator appointed in June 2008 to the Integrity Plus Fund.
The men ran two schemes. The first was called the “Super Save” scheme, which operated from 2006, while the Integrity Plus scheme started in 2004. Over 250 investors put in more than $30 million to the Integrity Plus scheme, with most of the investors from Sydney and the Southern Highlands.
Wood pleaded guilty to 10 charges last week, including six counts of making false statements to investors, and four of fraudulently misappropriating investor funds. Truong pleaded guilty to four charges of making false statements.
A third person involved in the scheme, Con Koutsoukos, hasn’t entered a plea for three charges of making false statements to investors.
Wood and Truong will appear in the Sydney District Court on Friday, June 15. Koutsoukos will appear in the Local Court next month.
Last month, the Federal Court fined three people $200,000 for their participation in a Ponzi scheme, which sold worthless “travel certificates”. The only way a person could earn money from their participation was by recruiting new members.