Mutual responsibility lost in Greymouth

Operator of the world's biggest Ponzi scheme, Bernard Madoff. Photo / AP.

There's something missing from this story which chronicles the sad tale of Geoffrey Adams, 41, of Greymouth.

Adams, perhaps the West Coast's answer to Bernie Madoff, admitted to swindling his clients out of about $600,000 in a very rudimentary Ponzi scheme.

There wasn't much to it, Adams simply attracted new clients "to pay out other investors as they retired and for his personal lifestyle".

In his plea for bail, Adams' lawyer said the guilty man had already paid back $44,000 and could handle paying $250 a week, which by my reckoning would take him over 40 years to clear the debt.

Judge Michael Crosbie quite rightly wasn't having a bar of it and, in refusing bail, said Adams would most likely have to serve some time in jail.

His former clients may derive some satisfaction from this judgment. I hope they got some money too. According to the story, Adams was employed by a "mutual insurance company" during his Ponzi period.

And this is the glaring omission - the company in question remains anonymous, which doesn't seem right in the circumstances. It may be possible to guess which "mutual insurance company" Adams worked for - there aren't that many left in New Zealand - but I couldn't find reference to it.

And the company should bear some responsibility, particularly, as Crosbie notes, Adams has a record of "a number of offences relating to dishonesty from 1986".

That's right - 1986: shouldn't the insurance company carried out a few simple checks before hiring the guy?

Under new rules crawling their way into being, insurance companies and other entities that want to badge individuals as their agents or employees will have to be much more rigorous in their hiring and monitoring processes.

And if financial companies - even West Coast mutuals - want to lend their reputation to dubious individuals, they owe us the courtesy at least of apologising in public when it all goes wrong.