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.