Accountants give NZ's biggest fraudster the boot

David Ross was jailed for 10 years and 10 months for running a Ponzi scheme in which his investors lost $115 million when his business collapsed. Photo / Mark Mitchell

Fraudster David Ross - the Wellington businessman behind one of the biggest financial swindles in New Zealand's history - has been struck off the chartered accountants' register.

Ross admitted and was convicted for running a Ponzi scheme, which reported false profits of $351 million between June 2000 and September 2012 from the purported trading of fictitious securities.

The overall loss to investors when his business, Ross Asset Management, collapsed in November 2012 was in excess of $115 million.

A Ponzi scheme is when investors are paid out using incoming money from new clients rather than legitimately made profits or returns. Such schemes generally require a constant stream of new investors, who believe their funds are being properly used rather than being paid out to other clients.

Last November Ross was sentenced to 10 years 10 months' prison - more jail time than any failed finance company director or anyone else involved in a Serious Fraud Office prosecution has received.

Last week the New Zealand Institute of Chartered Accountants' disciplinary tribunal considered a charge it brought against Ross, who was a member of the professional body.

The charge was that the fraudster "had been convicted of offences punishable by imprisonment or a fine and those convictions reflect on his fitness to practise accountancy and/or tend to bring the profession into disrepute".

In a decision released publicly today, disciplinary tribunal chair Jim Hoare said Ross appeared to have no mitigating factors.

"The Tribunal finds it difficult to imagine more serious professional misconduct than this," Hoare said in the decision.

Ross was removed from the Institute's register of members and ordered to pay $7209.