Kiwis get fraud lowdown

Jacqui Bradley. Photo / Brett Phibbs

Bernie Madoff's nemesis to give public talk ahead of top-level international summit.

Serious Fraud Office boss Simon McArley is hoping a talk from the man who blew the whistle on the Bernie Madoff Ponzi scheme will help New Zealanders to identify future financial rip-offs.

Harry Markopolos will speak at a public seminar today ahead of a two-day private conference of leaders from economic crime agencies from around the world.

Markopolos, a quantitative financial specialist, began to get suspicious about the Madoff scheme nine years before it imploded after his boss asked him to create an investment product with similar returns.

The scheme fell apart in 2008 and Madoff was convicted and given a 150-year sentence in 2009.

McArley said that in the past two years the Serious Fraud Office had dealt with six actual or alleged Ponzi schemes with total losses likely to be more than $500 million.

"The presentation from Harry Markopolos is timely given the recent conviction in the B'On case and the suspicions around Ross Asset Management."

B'On principal Jacqui Bradley was last year found guilty of 75 fraud-related charges involving the loss of $15.5 million. Ross Asset Management collapsed before Christmas and is now being investigated.

McArley said New Zealanders could learn a lot from Markopolos.

"Hopefully we can learn the lessons from him that will enable the SFO to continue its drive towards prevention and early intervention and thereby minimise the impact of such frauds on people and the economy."

The public seminar will also feature two FBI agents who will talk about insider trading and Commander Stephen Head from the City of London police.

The seminar comes ahead of the first meeting of the International Economic Crime Agency - a new group formed to boost co-operation on financial fraud between countries.

Representatives from Canada, Malaysia, Europe, America, Indonesia, Singapore and the United Kingdom will attend the event.

McArley said the group had decided to get together at last year's Cambridge International Symposium on Economic Crime to get a more operational focus.

McArley saidthat previously most international interaction on fraud had been via the police or formal legal liaisons.

The network was aimed at improving the exchange of intelligence and sharing any possible risks that were emerging.

"We are noticing more and more of our cases have an international bent to them. This is a way to build up our expertise," McArley said.

New Zealand had had direct links with some jurisdictions in the past like Britain, Europe and Australia but the movement of population meant its focus was shifting from Europe to Asia.

"The world economies are getting more interconnected."