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Financial adviser pleads guilty to $5 million fraud

A financial adviser, whose clients followed him when he left a large institutional investment firm to set up in his own business, has admitted a $5 million fraud.

Evan Paul Cherry was a director of the Albany-based Investment Solutions companies, which received about $9 million from an estimated 175 investors.

The 53-year-old pleaded guilty in the North Shore District Court today to four charges laid under the Crimes Act by the Serious Fraud Office.

The charges relate to the misapplication of investor funds and false statements in investor reports while Cherry was the director of Investment Solutions, ISL Nominees, Trading Strategies, ISL Strategic Investments and ISL Strategic Investments 100 Limited.

Between January 2001 and February 2007 when the majority of offending occurred, approximately $5 million of funds was invested contrary to investment instructions.

Most of the investors affected had transferred to investments offered by Cherry’s personal advisory business from those of a large institutional investment company when he quit that firm, the SFO says.

SFO chief executive Adam Feeley says the case illustrates the importance of looking beyond personal connections and carefully assessing the risk of investments.

“The high level of trust associated with personal relationships reduces any questioning by the investor when presented with a change in the underlying nature of the investment. It can be a dangerous arrangement that clouds judgement”, Mr Feeley says.

The SFO started investigating Cherry in June 2011.

Cherry was remanded in custody until sentencing on December 11.
 

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Comments and questions
8

Wonder where all that money went from the 'property' he had?? Surely it didn't just vanish into thin air ... ?

When you live the way the Cherrys lived it's easy to account for $5m over 10 years. They spent all the money and had a great time doing it from 2001-2010.

The other side to this story though, is what a total failure Evan Cherry was as a financial manager. What few attempts he did make at investing resulted in the other $4m being lost.

He couldn't make it, so he decided to fake it, and he made that decision right from the start.

What an absolute scumbag - to take money from family and friends to live the high life.

Yep - just like Doug Somers-Edgar and a multitude of others !

And he calls himself a Christian!!! What a joke!!!!!

No suprises here, because it's what self-proclaimed christians do.

If this man really does claim to be a Christian at least he's only deceiving himself this time - evil is, as evil does.

Yes where did all the assets go he cleverly disposed of them prior to the SFO investigation ,what about his ex wife she was reported to be doing the books for ISL, was a shareholder and taking a very handsome monthly pay cheque-why is she not facing the music-I guess thats is why he pleaded guilty -too many questions would be asked in the high court.!!And where is his accountant in all this. Another issue is why isnt he and Evan facing charges by not complying with the ird and the off shore investments -were they all a sham