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Nelson businessman accused of running $US42m ‘ponzi’ scheme

A Nelson businessman has been named as the architect of a series of allegedly illegal investment schemes which Australian authorities claim to have netted more than $US42 million.

David John Hobbs, of Stoke, his wife Jacqueline Hobbs, and six Australians are accused of misleading investors and operating a financial service business without an Australian licence.

The Australian Securities and Investments Commission (Asic) has sought court orders to disqualify them from managing the investment funds, which allegedly targeted Australian superannuation investors.

Asic says that since 2002 more than 700 Australians have invested in excess of $US42 million through funds such as the Integrity Plus Unit Trust and Super Save Superannuation Fund.

The regulator claims the scheme operators used offshore companies in countries such as the British Virgin Islands and Vanuatu to “conceal the true nature of their operations” and circumvent Australia’s financial services laws.

The operators allegedly promised investors no risk for 3-4% returns per month before sending the money to offshore accounts, including New Zealand, Hong Kong and the US.

Asic says only a portion of the investors' funds were actually invested and, contrary to promises made, these funds were used to engage in high risk commodities, futures and options trading in the US.

Some investor funds were also used in a ponzi scheme to pay monthly returns to investors, Asic says.

Asic has already frozen eight offshore bank accounts and has secured $A20 million of investor funds. It is now seeking to have a liquidator appointed to wind up the scheme and distribute the money recovered back to investors.

Asic says Mr Hobbs was the principal operator of the scheme and controlled all 14 funds involved.

The Australian NSW residents named were:

Min Hua (Lilly) Li  (47), of Lugarno;
David Collard (63) of Peakhurst;
Brian Wood, 67, of Concord;
Jimmy Truong, 34, of St Johns Park, and
Con Koutsoukos, 41, of Wiley Park.

NBR attempted to contact Mr Hobbs for comment but he could not be reached.

Companies Office records show he has multiple addresses in Nelson, but his phone number is not listed.

More by Duncan Bridgeman

Comments and questions
12

Besides the underlying and main issue of concern, being the breaches of fiduciary duties, it will be interesting to see if the regulators in Australia can touch a New Zealand resident for breaching Australian securities laws.

This has been coming for a long time, I hope they can finally close him down.

isnt great that after all the hurt he has done to others by putting the blame on everyone else he is now getting what he deserves, i cant wait for the day when he gets convicted and the truth about why he uses those crutches comes out. he sais MS but the truth is he got his for crossing the wrong people

Looking forward to the day that david is homeless just like some of the people he has lied to and have lost their homes...

David John Collard stole $100,000 from me in Fiji. He will get his one day.

This David Hobbs is wicked! He should have been arrested and charged over all the fake schemes he convinced many elderly Nelsonians to invest their savings and for some who mortgaged their homes to invest in his "Sure Thing" schemes. And yes some of them have lost everything they've worked their lifetime to build... Sadly it seems these ripped off investors are too frightened to lay complaints to the fraud squad...for fear of losing the promised money that is still coming ...but will never be, fear of his threats of legal action, fear of admitting foolishly getting suckered in....
So he lives the high life while other blinkered investors:still hope that he'll come up with the promised cash, cause he's such a nice honest bloke. Yeah right! Tui anyone?

So the plot is very thickened indeed... it seems this michael gilbert associate of David Hobbs is still advertising legal services...Is there justice for white collar crims?
07/09/2011....A Nelson
lawyer is facing seven misconduct charges including allegations of perjury
stemming from his involvement with a Bahamas-based investment company.

The Lawyers and Conveyancers Disciplinary Tribunal is sitting in Nelson this
week to hear the misconduct charges against Michael Gilbert pertaining to
work he conducted between 1998 and 2004.

Mr Gilbert used to have a practice in Collingwood St. Among the charges
brought against him by the Law Society's Nelson branch, it is alleged that
Mr Gilbert falsely witnessed signatures, failed to disclose information to
the High Court, provided incomplete lists of documentation in court cases
and gave false evidence.

Law Society counsel Peter Whiteside said the charges arose from two
litigations – one filed in the High Court in Dunedin in 1999 by Imperial
Consolidated Group and Imperial Consolidated Securities against David
Stewart, and a claim by Nelson businessman David Hobbs against Mr Gilbert in
the High Court in Nelson in 1999.

"Both proceedings involved companies in the Imperial Consolidated Group
incorporated in the Bahamas which borrowed funds from investors and promised
to pay those investors significant interest rates," Mr Whiteside told the
tribunal.

"Mr Gilbert effectively acted as the New Zealand solicitor for those
Imperial Consolidated Companies and was also instrumental in sourcing funds
to be invested in those companies."

Mr Hobbs and Mr Stewart were involved in investing for themselves and as
brokers for others in Imperial Consolidated, the tribunal heard.

The Securities Commission issued a warning about the scheme in 1999, and
banned its advertisements. Mr Gilbert resigned as chairman of the Nelson
Building Society around this time.

Mr Gilbert and the Law Society's Nelson branch both declined to comment this
week. The hearing is expected to last three days.

Hobbs only became interested in a friends mother when her social climbing husband told everyone in a Nelson Bar that his wife was an heiress...Hobbs instantly became his best friend. The rest is history as is her retirement funds and mortgage free home.

What about his other minions he has running so called investment schemes? Promises of regular returns, new Holden's and jet skis are how he and his brother manipulate people. And they have the cheek to believe in religion pfffft heathens!

We have forgot one thing here, the so called agents ,the likes of Con Koutsoukos, Jimmy Truong and Brian Woods,who have sat at dinner tables of family and friends, took their hard earned dollars and then had the audacity to blame David Hobbs for the fall out. They are all of equal blame as they profited from the fraudalant proceeds and I'm very sure these so called agents knew exactly what they were doing..every DOG has his day... but some much sooner than others..

Can some check on what he is doing currently as he is still link very much with the Tokaikolo Christian Church and the Church's president who resides in Tonga and Manurewa. The Church situates at Coronation Road,Mangere and they have invested almost a million dollars with Hobbs and the church have been promised millions pay out but still none. The Church are raising money all the times to pay for debts as a result of this investment. The people need help and this need to stop.

He is in court in Sydney.Hopefully getting found guilty.