Trio's Richard jailed for 2? years over stolen super

A SMOOTH-TALKING Canadian patsy took the fall for Australia's largest superannuation theft yesterday, but the major beneficiary of the crime remains at large.

By InvestSMART · 13 Aug 2011

By InvestSMART ·
13 Aug 2011

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A SMOOTH-TALKING Canadian patsy took the fall for Australia's largest superannuation theft yesterday, but the major beneficiary of the crime remains at large.

Shawn Richard, known by his Facebook nickname Shawny Cash, was sentenced in the NSW Supreme Court to a minimum of two-and-a-half years in jail yesterday.

The sentence immediately attracted the ire of investors in Trio Capital, which collapsed in late 2009. Trio investors lost $180 million sent to offshore hedge funds through Astarra Strategic and ARP Growth.

"We will be paying for many more years," Beth Roffe, a Wollongong investor who lost $500,000 and is living on the pension, said outside the court yesterday.

John Hempton, a fund manager who first exposed the fraud, said: "This has caused a very large number of people a very large amount of pain. If he had mugged three of those people and took their purses he would have probably got a longer sentence."

Richard, 36, looked haggard and unshaven as Justice Peter Garling found he was "motivated simply by greed" when he directed $26.6 million into offshore funds, knowing the money was being stolen.

But Justice Garling's sentencing remarks show that a US citizen based in Hong Kong called Jack Flader was the real mastermind and major beneficiary. Mr Flader remains at large.

Justice Garling sentenced Richard to a maximum sentence of three years and nine months.

He said he was prepared to accept Richard, described as "ripe for the picking" by his lawyer, had been naive and gullible when he started working for Mr Flader. But he said benefits Richard received included secret payments of $1.3 million to personal bank accounts in Liechtenstein and Curacao and payments to his company of $5.3 million.

"Mr Richard is guilty of serious crimes of a high order. They were carefully considered and planned, they were concealed, they continued over a period of nearly four years and they led to significant financial losses," Justice Garling said.

"Whilst he may not have been the ultimate controller, a role attributed to Mr Flader, he was the central figure in Australia, without whose participation these offences could not have occurred."

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Frequently Asked Questions about this Article…

What was the Trio Capital superannuation theft and what happened in the court case?

The Trio Capital case involved the collapse of Trio in late 2009 after about $180 million of investor superannuation was sent to offshore hedge funds. Shawn Richard (aka “Shawny Cash”) was convicted for directing $26.6 million into offshore funds and was sentenced in the NSW Supreme Court. Justice Peter Garling described the crimes as carefully planned and causing significant financial losses.

Who is Shawn Richard and what sentence did he receive for the stolen superannuation?

Shawn Richard, 36 and known on Facebook as Shawny Cash, was sentenced by Justice Peter Garling to a minimum of two-and-a-half years in jail and a maximum of three years and nine months for his role in the theft. The judge found he acted out of greed and played a central role in Australia in the offences.

How much did Trio investors lose and which offshore funds were involved?

Trio investors lost about $180 million, which was sent offshore through hedge funds including Astarra Strategic and ARP Growth, according to the article. Much of the misdirected money was routed to those offshore vehicles.

Who is reported to be the mastermind or main beneficiary behind the Trio fraud?

Justice Garling’s remarks pointed to a US citizen based in Hong Kong named Jack Flader as the likely mastermind and major beneficiary. According to the article, Mr Flader remains at large.

Did Shawn Richard personally benefit financially from the scheme?

Yes. The article states Richard received secret payments of about $1.3 million into personal bank accounts in Liechtenstein and Curacao, and about $5.3 million was paid to his company, which the judge considered when assessing his role.

How did investors and commentators react to the sentence in the Trio Capital case?

Investors reacted angrily and emotionally. For example, Wollongong investor Beth Roffe, who lost $500,000 and is now on the pension, said people will be paying for many more years. Fund manager John Hempton, who first exposed the fraud, said the crimes caused a large number of people significant pain and questioned the adequacy of the sentence.

Does the criminal sentence mean Trio investors will get their money back?

The article does not report any immediate recovery of investor funds. While the sentence addresses criminal accountability, it notes the major beneficiary remains at large, so the sentencing itself does not guarantee recovery of the lost $180 million.

What does the Trio Capital scandal mean for everyday superannuation investors?

The article highlights how fraud and misuse of trust can cause severe, long-term losses to retirement savings. It shows offshore fund exposure and concealed payments were central to the harm, and many investors suffered substantial personal financial pain as a result.