Kelly Tonkin is charged in connection with one of the biggest suspected investment fund frauds in New Zealand. Photo / George Heard
A Christchurch-based economist accused of one of New Zealand’s biggest investment fund frauds – allegedly involving several wealthy advertisers – this morning admitted his offense.
Kelly Simon Tonkin was scheduled to appear in Christchurch District Court for the first time in May after charges were brought against him by the Serious Fraud Office.
He was granted remand and appeared in court in person for the first time today before Judge Tony Couch.
During the brief hearing, the 52-year-old pleaded guilty to four counts.
He initially faced five charges – but one of them was withdrawn today by the SFO.
The details of two other charges have been changed as agreed by the SFO and Tonkin.
Although the details have changed, the charges have remained in place.
Tonkin pleaded guilty through his lawyer Elizabeth Bulger to a charge of false accounting; two of making false statements to cause losses or inducing new investors, and one count of forging a false audit letter.
As a result of today’s hearing, Tonkin was remanded in custody until his conviction later this year.
Couch J. said the summary of the facts was “quite long” and the case was complex, so sentencing was likely to take “a considerable amount of time”.
He reserved half a day because the “time required is long” for the pronouncement of the sentence, which would involve a significant number of victims.
The SFO said there were “around 170” victims.
It was unlikely that every victim would want to be heard during sentencing.
Victims cannot be identified due to a removal order which may be made permanent upon sentencing.
The summary of the facts is still being finalized between the OFS and the defense, Tonkin contesting several points of the current version.
According to prosecution documents, SFO claims investors in Tonkin’s Penrich Global Macro Fund learned that the program was worth $ 137.2 million in February last year, but was actually only worth of $ 20.7 million.
The alleged fraud is believed to be one of the largest of its kind in New Zealand history.
Several members of his family supported him during his brief appearance.
In May, the Herald revealed that Penrich had suddenly collapsed in March 2020 and that liquidators had been appointed at its branches in London, the Cayman Islands and Christchurch.
They told investors that a “significant gap” had been discovered.
The OFS began to investigate shortly after.
Tonkin was then indicted.
The Herald then reported that the false accounting fees were linked to Tonkin’s alleged inclusion of bogus asset values and hidden cells in the fund’s “Monthly Value” spreadsheets for nearly a decade, from September 2012 until the fund was suddenly frozen in February 2020.
For example, in September 2012, the fund declared a value of $ 13.6 million, but the SFO claimed that this had been inflated by $ 10.6 million.
In 2016, a UK pension scheme indicated in its annual report that it had withdrawn from the fund “due to the delay in providing audited accounts … and the inability of the auditor to verify the valuation of the underlying assets “.
The billing sheets allege that a number of international clients stopped receiving monthly statements from investors around this time, suggesting they withdrew their investments.
According to the prosecution documents, on December 18, 2017, Tonkin allegedly fabricated financial statements that misrepresent the fund’s position in 2016.
“The defendant falsely indicated the total assets, total liabilities and net assets of the Penrich Global Macro Fund”, alleges the SFO in its accusation of forgery.
“The defendant falsified a BDO Cayman Islands auditor’s report and attached it to the financial statements.”
The misrepresentation accusations relate to Tonkin’s statements to investors, both by including the allegedly fraudulent inflated value in their monthly account balances, as well as in the monthly updates of its trading activity which the SFO says have vastly underestimated the level of risk and the losses it suffered. incur.
Tonkin grew up in Christchurch and graduated from Canterbury University with an Honors BA in Economics, before working at the Treasury and then at the Banker’s Trust where he made regular appearances in the media giving commentary from economic experts and financial.
He moved to London in 1999, working for the ill-fated investment bank Lehman Brothers, before founding Penrich in 2004 and returning to New Zealand a decade later, where he became a fixture in Canterbury football and advice. administration of Cashmere schools.
Until the collapse of Penrich Tonkin was well known and respected in financial circles.
The charges he faces all carry a maximum sentence of 10 years in prison.
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This notice was published: 2021-06-16 23:39:18