“The largest bank robbery in New Zealand history didn’t even get a million dollars, and it was 25 years ago.
“If you look at crimes that, cost in dollar terms, you’re much better looking at your investment hucksters, and scammers, even some of the smaller operators are pulling in, you know, more, well more than a million, some even managed to get up to nine figures,” he said.
The collapse of South Canterbury Finance was one of those.
“It turned out there were some shenanigans on their ballot sheet, hiding related party loans that, if the Government had known about it, they might not have guaranteed them.”
The company went under, triggering a $1.5 billion payout and was at the centre of the country’s largest fraud prosecution.
But despite the huge financial harm white-collar crime caused, it was one of consent, Nippert said.
“Guns aren’t being drawn and people handing over their wallets or emptying their purses.”
The crimes were committed by people who convinced people to part with their money, usually for an invalid or untruthful reason, he said.
“They say they’ll invest it somewhere, but in fact, it goes to pay off the other investors that want to get out. It’s a Ponzi scheme or it’s just being totally misappropriated.
He said there was a reason that con men were called con men, because they oozed confidence.
“I haven’t yet met a fraudster who wasn’t charismatic. I mean you’ve got to be good to convince people hand over the hard-earned cash.”
Nippert said there was also a certain level of shame that came with being tricked and that meant it wasn’t always reported and there were commercial consequences too.
“If your bank realises that you’ve lost a million dollars of your business’ money, they might want to take a closer look at your finances to make sure you can repay.”
The economic cost of fraud in New Zealand is about $10 billion a year, Nippert said.
However, about $7 or $8b of that was tax avoidance.
“IRD does have a fairly big investigations unit and they possibly get about a billion dollars of that a year. There have been some researchers say the amount that is missed is considerably more,” he said.
Some of the scams were getting pretty sophisticated too.
“There’s one of the most insidious ones I’ve seen is scammers setting up websites, and buying Google ads. So people are Googling, where’s the best place to invest my money, they’ll have their site comes up, which again, doesn’t look like a scam.
“It’s just a comparison site of interest rates. And it allows you to register your email address and phone number if you’re interested in talking about your options with a financial adviser. And of course, you’ll soon receive a call, but it won’t be a financial adviser, it’ll be a scammer.”
New Zealanders could also be a little naive, he said.
“We believe in each other way too much. We will take word of mouth recommendations quite strongly, - this leads us to be particularly vulnerable.”
Listen to the full episode for more on the impacts of fraud in New Zealand.
The Front Page is a daily news podcast from the New Zealand Herald, available to listen to every weekday from 5am. The podcast is presented by Chelsea Daniels, an Auckland-based journalist with a background in world news and crime/justice reporting who joined NZME in 2016.
You can follow the podcast at iHeartRadio, Apple Podcasts, Spotify, or wherever you get your podcasts.
