$5m ponzi fraudster sentenced
A man who defrauded his friends to the sum of $5.4 million by convincing them to pour money into bogus overseas investments has been imprisoned.
Shane Scott, 60, used promises of high returns for non-existent property developments and overseas investments to deceive 13 people he knew over a period of 13 years.
He was sentenced to four years and eight months’ imprisonment at the High Court in Auckland yesterday by Justice Christine Gordon.
Some of the phony investments he offered were deals in Thailand, diamond trading, South African trade deals, a chicken farm in New Caledonia, and importing merchandise for $2 shops.
‘‘There were no investments; this was blatant fraud,’’ Crown prosecutor Nick Williams said.
‘‘The motivations, the SFO [Serious Fraud Office] says, is greed, pure and simple. It does not accept Mr Scott’s explanation this was born out of desperation.’’
Scott’s offending was a classic ponzi scheme, which had caused massive financial and emotional harm to his victims, Williams said.
‘‘This was not money obtained from strangers; it was from friends and associates … It was a complete and utter fabrication. There was no money invested at all,’’ Williams said.
Due to the nature of the ponzi scheme, not all of Scott’s victims lost money. The court heard some were paid back, but $2.1m was still outstanding.
Scott’s lawyer, Adam Holland, told the court his client’s offending was not sophisticated.
‘‘He understands a custodial sentence is the only outcome available to the court today,’’ he said.
‘‘He is fully aware of the victims in court today and fully acknowledges the harm he has caused to those individuals.’’
Holland said Scott was in poor health, which had been exacerbated by the court process.
Justice Gordon told Scott his offending caused much pain to his victims. ‘‘Some have lost their retirement savings and now struggle to make ends meet. You abused the trust of friends and associates over 13 years.’’
She noted Scott had attempted to pay some victims back by selling assets.
Scott first appeared in the Auckland District Court in January and initially entered a plea of not guilty.
At the High Court last month he pleaded guilty to 27 charges. These were 20 charges of theft by a person in a special relationship, four charges of obtaining by deception, two charges of obtaining by false pretence and one charge of using a document with intent to defraud.