Mark James Whelan (41) pleaded guilty in the Auckland District Court on July 1, 2014 after giving evidence at his trial on a second Serious Fraud Office (SFO) investigation against him.
SFO’s charges against Mr Whelan related to his involvement with options trading company Derivatek New Zealand Limited (Derivatek) and his own company Global Futures Trading Limited (Global Futures).
Mr Whelan faced 10 Crimes Act charges, comprising three of theft by person in a special relationship and seven charges of false statement by promoter.
Global Futures was incorporated in November 2006. From mid-2007 to February 2009, Mr Whelan used Global Futures to obtain funds from high net worth individuals for trading through Derivatek.
He used investors’ money to fund an advance fee for a US$20 million loan, for personal use and to repay other investors.
To conceal this activity, Mr Whelan issued false statements to the investors.
SFO Chief Executive Julie Read said that the investigation uncovered a multi-layered fraud, with the need to fund one fraud driving further offending.
“Where the return on investment is significantly higher than market rates, investors should be aware that they may lose their money, because very high returns generally equal very high risk or, in some cases, fraud,” she said.
Mr Whelan was remanded in custody until July 3, 2014 for a sentencing date to be fixed.
SFO commenced an investigation into Derivatek based on the information obtained during an earlier investigation into an options trading company operated by Gregory Arnott.
Mr Arnott also pleaded guilty to charges in relation to Derivatek. He had also been remanded until July 3, 2014.