The Serious Fraud Office has launched an investigation into a group of companies formerly controlled by an ex Wall Street banking corporation director.

The office said today it had executed search warrants at WSD Group's premises in Mount Eden Road, and searched a private address in Glendowie.

WSD was, until recently, controlled by former Wall Street Banking Corporation Director, Riaz Patel.

The investigation centred on allegations WSD failed to correctly account to investors for funds received and involved WSD Global Markets Limited, WSD Financial (NZ) Limited, WSD Financial Group Limited and others.

WSD Global Markets Limited is accredited as an NZX Futures and Option Firm. None of the other entities are accredited or regulated by NZX.

SFO Chief Executive, Adam Feeley said the investigation had been coordinated closely with the NZX and Securities Commission.

Feeley said that WSD had actively promoted New Zealand as part of its marketing strategy to investors and states on its website:

"New Zealand has developed a sophisticated, unrestrictive business environment that competes aggressively in world markets. Geographically New Zealand has the advantage of being the first country to start the trading day being midway between the USA and Asia. This advantage is further complemented with political stability and world class, business orientated, governance.... With new initiatives it has grown into a financial services powerhouse in the Pacific with regulations that add support to the industry. More and more international investors are now looking to New Zealand for investments and related services."

"Most of the investors in WSD are overseas residents, so it is important that the SFO does all it can to protect New Zealand's reputation amongst both domestic and international investors as a well-regulated and safe place to invest," Feeley said.

Feeley said there was a misconception the SFO had previously investigated WSBC.

"In 2008 we simply provided assistance to the foreign authorities who were investigating WSBC."

The file was closed once that role had been fulfilled, he said.

In 2008 the Cook Islands Financial Supervisory Commission placed WSBC in statutory management and revoked the banking licence with effect from 31 December 2009.

The latest major investigation is the twelfth commenced by the Serious Fraud Office this financial year.