"Each year he was required to make increasing profits and it all blew out. He tried to keep things together. It was a gross error of judgment, and he could not achieve the success that he was used to."
Wood operated a classic Ponzi scheme — a fraud which promises high returns for investors but sees those returns paid to older clients through revenue from new investors.
"The fact that Mr Wood derived no personal gain largely reflects the nature of a Ponzi scheme, in which the primary motivation of the offender will generally be the need to use incoming funds to repay existing investors," the Court of Appeal explained of his case.
While incarcerated, after pleading guilty to two representative charges of obtaining by deception and theft by a person in a special relationship, Wood turned his attention from the markets to the canvas.
He has completed 100 paintings, some of which appeared to impress the Parole Board's panel, and is also seeking to complete a diploma.
A parole assessment report said Wood's painting may be a way to make money for charity in his spare time, while he also referred to the 4000 hours he devoted to community service before being convicted.
"We note that this is likely to have been during the same 11-year period that he was being dishonest and likely conducting the Ponzi scheme," panel convenor Tania Williams Blyth wrote.
"While we have some disquiet regarding his views of being a high achiever and now producing extraordinary paintings which he thought he may be able to sell and make money for charity, we are satisfied that Mr Wood clearly understands that he is not to operate a business or handle money in relation to the business for other organisations."
Before entering the forex markets, Wood worked in the banking sector and once described himself as "the youngest manager in ASB". However, he said he also developed an "ultra-ego".
Wood told the Parole Board this ego was involved in his fraud.
"While he was offending, he was also running another business with four staff. He tried to keep that going as long as possible. He did what he could until ... there was nothing left," the Parole Board's decision reads.
But Wood's offending was only discovered after he blew the whistle on himself, which proved to be a significant factor in the reduction of his prison sentence. The Court of Appeal said it was "difficult to see how Mr Wood could have co-operated more fully with the authorities".
He first approached the FMA Financial Markets Authority (FMA) in 2017 before he "frankly acknowledged his offending" in voluntary interviews with the FMA and Serious Fraud Office (SFO), court documents read.
In 2018, Wood told the SFO about $9.8m of principal and interest was still owing by the two forex companies to some 20 investors. He also admitted providing 223 false investment reports to clients to enable the companies to continue to trade.
Wood tried to trade his way out of trouble, he explained, while knowing the clients would want to withdraw their funds if they knew the true situation about their investments.
Between 2008 and 2017, 21 clients deposited about $22m — unaware their capital was being eroded by foreign exchange trading losses.
Rather than advise his clients, however, Wood provided them with investment reports purporting to show the current balances of their investments. In some instances, he even created fictitious returns on clients' investments, while other reports referred to bogus foreign currency transactions.
More than $7m of investment principal belonging to at least 18 investors was lost, the court heard at his sentencing. Three victims suffered losses exceeding a million dollars, with one losing $1.7m, and an elderly victim said her life savings had vanished.
The Parole Board's decision said Wood's clients suffered losses of more than $9m.
Wood, however, told the Parole Board he now intends to be a new man, has renewed his faith in God, and agreed not to have access to a phone or internet upon leaving prison.
"Taking all matters into consideration we are satisfied that Mr Wood no longer poses an undue risk and any residual risk can be managed by the conditions," the Parole Board ruled, ordering his release last week.
Wood will be subject to standard and special conditions for two years, which include not being involved in the handling of money, not engaging in the affairs of any business, trust or company, and not providing financial or business advice without prior written approval of a probation officer.
