A LONG-RUNNING investigation of a Ponzi operation in which more than $30 million in superannuation money was invested has resulted in two people pleading guilty in court.
The pleas come nearly five years after the Australian Securities and Investments Commission obtained an injunction preventing the operation of the scheme, the Integrity Plus Fund, and securing investors' remaining funds.
In mid-2008, the New South Wales Supreme Court ordered the winding up of the illegal, unregistered managed investment schemes, Integrity Plus Fund, and another related scheme, Super Save Superannuation Fund. About $22 million was recovered.
The liquidator, Barry Taylor of HLB Mann Judd, said in an affidavit in other proceedings that the Integrity scheme operated between September 2004 and January 2008.
"During this period it accepted approximately $US29,399,627 from investors and paid total 'returns' of $US9,128,821. However, the Integrity scheme was a Ponzi scheme that is to say the 'returns' were not paid from profits on funds invested, but rather from capital contributed by other investors."
He said the Integrity scheme was administered by PJCB International, which was incorporated in the British West Indies.
Mr Taylor said some investors attended seminars by a company called Future Trading Corporation, which described itself as an "innovative supplier of financial education material".
Last week in the Downing Centre Local Court, Brian Wood, of Davistown, and Jimmy Truong, of St John's Park, pleaded guilty to charges of making false statements to investors. Wood also pleaded guilty to charges of misappropriating investors' funds.
ASIC said both men had falsely stated to investors that they would earn returns of 4 per cent a month and their capital was guaranteed. Wood and Truong were two of the "beneficial owners" of PJCB International.
ASIC said a third man, Con Koutsoukos, of Wiley Park, had not entered a plea to three charges of making false statements to investors.
The matter returns to the District Court later this month.