A Wellington financial adviser accused of operating a $400 million Ponzi scheme has been charged with false accounting and theft.
The charges against David Ross of Ross Asset Management were laid by the Serious Fraud Office following its joint investigation with the Financial Markets Authority.
The 63-year-old faces four Crimes Act charges of false accounting and one charge of theft by a person in a special relationship.
The investigation began in November last year following complaints of delayed or non-payment of funds to investors. The SFO says more than 1200 clients of Ross Asset Management have been affected.
The charges allege that Mr Ross conducted a Ponzi scheme which he disguised by falsely reporting clients' investments.
The Serious Fraud Office argues that large portions of client portfolios were shown as being invested through a fictitious broker, resulting in an overstatement of investment by more than $380 million.
In October 2012, the Financial Markets Authority placed receivers at the company, who found only $10.2 million of investment existed.
The Serious Fraud Office says it will continue its investigation into Ross Asset Management. Acting chief executive Simon McArley says Mr Ross has co-operated with the inquiry and is on bail.
Mr Ross' lawyer, Victoria Heine says she anticipates he will enter a plea when he reappears at court on 4 July.
A spokesperson for investors in Ross Asset Management says he is relieved that the company's director is facing charges. Bruce Tichbon says David Ross is accused of committing a serious crime and should fully co-operate with the investigation. He says the charges are an important first step to achieving justice for those who lost money.
Investor Beverley Nicholson says she was led to believe her $50,000 investment had grown to $170,000. She welcomes the charges and hopes that Mr Ross is convicted and receives the maximum sentence.
