Operator of Kiwi Ponzi scheme sent to jail for six years

Chris Lee
Ponzi Scheme

A man who operated a fraudulent foreign exchange trading scheme, which wrongly took cash from investors, has been sent to jail for six years and three months.

Kelvin Clive Wood, who is aged 70 years old, was told today by the Auckland District Court that his crimes of “Obtaining by deception” and “Theft by person in a special relationship” were sufficient to land him with a custodial sentence.

Wood set up the fraud after his legitimate forex business started to see overall losses and lack of profits.

He continued to accept fresh funds, but he then passed these directly on to other clients to create the illusion that they were making profits.

However, they weren’t accruing the profits they were being told they had, and their gains were not real.

According to the New Zealand Serious Fraud Office, which prosecuted the case, Wood never informed his many clients that this was the case.

In total, he scammed people out of over $7 million over the course of a period stretching back until the first part of this decade.

He is believed to have taken investment cash from 18 individuals. This occurred over eight years, during which time he created false profit statements and distributed other inaccurate information in an attempt to throw his investors off course.

He operated two companies during his career both in legitimate and illegal forex trading. One was called Forex (NZ) Limited, and the other was called Forex NZ 2000 Limited.

He offered a range of products to the clients whom he later defrauded, including the purchasing of foreign currency, fixed interest term deposits and more.

It is understood from the Serious Fraud Office investigation that Wood’s clients invested with him “on the basis that their principal was not at risk”, suggesting that he may have given them guarantees as to the safety of their money.

According to a statement released by the Serious Fraud Office, which is responsible for looking into serious finance crime in the country, Wood committed a “breach of trust”.

“Mr Wood earned the trust of a group of investors through his personal and professional association with them”, said the Acting Director of the SFO, Rajesh Chhana.

“His breach of that trust is reflected in the sentence imposed today. The prosecution of such matters holds to account those who fail to conduct business in accordance with the expectations of a reputable market.”

Wood’s case has been long running. Back in October 2018, he told the Auckland District Court that he was not entering a plea against the two charges.

After this, he was remanded on bail.

In December 2018, he announced that he was pleading not guilty.

He later flip flopped again, however, and told a court in March 2019 that he was pleading guilty after all.

As part of his sentence, Wood will need to serve a basic minimum period of two years and 11 months. However, after this, he may be released depending on a decision made further down the line.


Chris Lee

Latest news

Keep Trading the Technicals to Take Advantage of a Quiet News Week
The absence of any significant diarised news announcements this week was highlighted on Monday in Trading Strategies to Suit The Week of 18th October. Read more
Trading Strategies to Suit The Week of 18th October
With minimal news events diarised for the week beginning the 18th of October, it looks like fans of technical analysis might be best positioned to test their strategies in the next few days. Read more

Safest Forest Brokers 2020

Broker Info Best In Customer Satisfaction Score
#1 ForexTime LogoYour capital is at risk Founded: 2011 Global CFD & FX Broker
Number One Broker
BEST FOREX BROKER Visit broker
5
#2 BlackBull Markets LogoYour capital is at risk Founded: 2014 Global Forex Broker
Number One Broker
BEST SPREADS Visit broker
4.8
#3 Your capital is at risk Founded: 2014 Global Forex & CFD Broker
Number One Broker
Best Trading Conditions Visit broker
4.9
#4 Forex Broker eToro Logo67% of CFD traders lose Founded: 2006 Global CFD & FX Broker
Number One Broker
ALL-INCLUSIVE TRADING PLATFORM Visit broker
4.9
#5 Forex Broker Pepperstone LogoCFDs and FX are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Founded: 2010 Global Forex Broker
Number One Broker
Low minimum deposit Visit broker
4.9

    Forex Fraud Certified Brokers

    XM Logo
    skilling logo
    investous logo
    FXTM Logo
    Vantage FX logo
    ATFX Logo
    Plus500 Small Logo
    Exness Small Logo
    IC Markets Logo
    HYCM Logo
    Pepperstone Logo
    Forex.com Logo
    AvaTrade logo
    OctaFX Logo
    IQ Option Logo
    LegacyFX Small Logo
    City Index Logo
    BlackBull Markets Logo