Fraudster behind $8.3m ponzi scheme jailed for eight years

BlackfortFX director Jimmie McNicholl was sentenced to 11 months of home detention and $50,000 in reparations. (Photo: TVNZ)
SFO director Julie Read says Lance Ryan "cynically manipulated vulnerable and trusting investors."

A serial fraudster who helped cheat Cantabrians out of more than $8 million in a Ponzi scheme has been sentenced to almost eight years in prison.

The Serious Fraud Office brought charges against Lance Ryan and Jimmie McNicholl after they used forex platform BlackfortFX to milk $8.3m in investments from 900 people mostly from the Christchurch region. They were convicted on the charges.

The pair were sentenced at the Christchurch District Court today. Ryan was jailed for seven years and six months, while McNicholl was sentenced to 11 months of home detention and $50,000 in reparations.

Ryan, also known as Lance Thompson, had pleaded guilty to fraud in May for his role in the scheme. He also has several previous dishonesty convictions, and Insolvency Act and Companies Act offences.

McNicholl was the sole shareholder and director of BlackfortFX and pleaded guilty in May to obtaining the registration as a financial services provider by deception.

“The sentence imposed on Mr Ryan reflects the very serious nature of his offending,” SFO director Julie Read says.

“He cynically manipulated vulnerable and trusting investors, many of whom have suffered considerable stress in addition to financial loss.”

Arena Capital, which traded as BlackfortFX, was registered on the Financial Service Providers Register and purported to offer foreign exchange services to clients.

Money was owed to nearly 1000 clients who placed money with the company on the understanding they would profit from trading in foreign exchange markets.

The SFO says instead, investors' money was pooled, and no funds went toward legitimate trading platforms.

Ryan was found to personally have taken at least $1.39m and McNicholl no less than $709,000 of investors' money. The pair used the cash to buy property and cars.

The Financial Markets Authority obtained asset preservation orders over Arena’s assets in May 2015 and referred the case to the SFO.

Arena was moved into liquidation by the Christchurch High Court on July 24, 2015.

FMA general counsel Nick Kynoch says despite the successful prosecution, hundreds of people remain out of pocket. 


13 · Got a question about this story? Leave it in Comments & Questions below.

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13 Comments & Questions

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It is great that NZ is such an easy place to start a business, other countries make you jump through hoops to prove you are legitimite.

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Given the seriousness of the offending, NBR, wouldn't it make more sense and be a better public service to your readers to publish pictures of Ryan and McNicholl rather than a picture of the SFO's Julie Read?

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Appropriate feedback Steve, thank you. I’m sure that the Editor will agree and update accordingly. From personal experience McNicholl is a real armpit. I am disgusted that he got off so lightly with 11 months at home. He is a lazy deceitful piece of work. I was hoping he would do real time because he’s hardly ever done a real job of anything other than cheat people to impress people with wealth he’s never earned. He used to be married to Sue White who I worked with in Christchurch Radio back in the mid to late 90’s, he was a “noting tosser” back then. This won’t be the last time he’ll cheat people out of hard earned money, he’s always had an eye for an easy buck. His image should be published extensively. 

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Thanks for your feedback Steve. We have updated the story with photo of McNicoll. Ryan we dont have unfortunately. 

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So you take $700k (at least) plus probably large salaries and expenses along the way, you have to pay back $50k and you get 11 months R&R at home playing Fortnite........as per my first comment, what is so great about how easy it is to open a business in NZ (and get FSP registration etc)?

Real businesses don't mind if it takes a little more work and effort, it is the norm around the world.

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Home D and a small fine, plus told not to do it again. I'm sure he's really learned his lesson, and pocketed $709k for his trouble.
The justice system has just told everyone in this country what sort of penalty you can expect to receive for this type of crime.

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Police should appeal McNicholl's sentence - it's pathetic.

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So much for the FMA.

How the heck did the FMA allow the this serial dishonest individual's company to be registered as a financial service provider? Did the FMA do any basic due diligence??????

Proving once again that the public can have zero faith in the bunch of highly paid inexperienced amateurs in the FMA to protect their interests.

Then, there's CBL too!

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Yes they really are a waste of time and money. Just another useless bums on seats govt department.

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And I'm glad to see the article is free content so anyone can view the article.

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Agreed, although the down side is that its free advice on how to make an easy 700k, give or take. Create a Poniz, get charged and asked to pay back 50K and to stay at home for a few months break, but hardly on the bones of your ass because with the profits you can afford takeaways every night while watching Netflix and planning your next heist. This guy WILL do it again, because he’s a scumbag who has a past.

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To me it just comes across as justice depending on who you are. If he was just a common burgler he would have got 6 months. Because he's a so called respectable businessman with a degree he gets H/D.
It just smacks of a two tier justice system, that is just plain wrong, and sends the wrong message.

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Home detention !! for $9 million fraud !! What a joke. Mcnicholl knew exactly what he was doing from the start.

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