The mastermind behind a complex advertising scam targeting charities and small businesses has been sent to prison.

Previously called a "parasite" of the advertising industry, Anthony John Hendon was today also labelled a "blight on commerce", as he was sentenced on two dozen fraud charges.

Justice Jill Mallon said Hendon, 54, used "a variety of deceptive tactics" to con people into buying ads for sham magazines.

At the High Court in Wellington this morning, Hendon was sentenced to four years' imprisonment.


He will also forfeit computers, related equipment and telephone systems used in the scam.

In February, he pleaded guilty to 24 charges of reproducing a document with intent to cause loss.

Justice Mallon said Hendon's offending involved 1732 acts against roughly 848 individuals, carried out over three years.

Hendon's operation ran from October 2009 to October 2012. It involved persuading advertisers to spend money on ads that were fictitious, or printed in absurdly small numbers -- sometimes just 20 to 30, never more than 200, prosecutor Grant Burston said.

Amounts invoiced were usually about $300 to $600 but some victims were fleeced of amounts from $4000 to nearly $40,000.

Justice Mallon said Hendon, who had previous theft and dishonesty convictions, conjured up a "quite elaborate operation motivated by financial gain".

Sometimes Hendon collected magazines from around the country, even from waiting rooms and police stations, then copied ads and edited the pages to add a fake magazine title. He'd send these "fax proofs" with the name of a made-up magazine to advertisers.

Forensic accounting found $786,000 from selling phoney ads went to Hendon's accounts but some of that was paid to fellow scammers.


Yesterday, scammers Johannes Middledorp and Noelene Banton were found guilty on seven charges each and not guilty on four charges after an earlier judge-alone trial.

They will be sentenced next month.

James Stephen Burns was sentenced in Wellington District Court last year to seven months' home detention for his part in the ad invoice scam.

In court today, Mr Burston said Hendon was the "mastermind" of the scam and his offending was far more serious than that of Burns.

Mr Burston said Hendon was responsible for recruiting people to the scam, and invoicing victims.

He suggested the judge consider five and-a-half years' imprisonment as a starting point for Hendon.

Hendon's lawyer Chris Nicholls said the court had to be "sceptical" about suggestions Burns was "just a salesman".

The scam was actually a "joint enterprise", he said, and it was reasonable to guess Burns would try wash his hands of Hendon.

Mr Nicholls said Hendon hesitated to plead guilty because many advertisers didn't actually have a problem with paying him money, or did not want to lay charges.

Victim impact statements showed a mix of "justifiable anger" and humiliation from people "taken in by a phoney telemarketing scam".

Mr Nicholls said his client was remorseful. Some of that was because Hendon had come to know and like some of his victims.

"He had the gift of the gab. He knew about their lives."

This was one reason Hendon pleaded guilty, Mr Nicholls said.

Anything more four years in jail would be unjust, he argued.

The court heard Hendon had 55 convictions for breaching the Fair Trading Act.

Some of these offences involved similar magazine ad scams, for which he was once fined $20,000.

Justice Mallon said, in light of this earlier offending, Hendon needed a "significant step up" in punishment.

"The Crown is correct to describe it as a blight on commerce," the judge said.

Hendon showed no emotion as he was led away from the dock.

The Serious Fraud Office (SFO) earlier said the scam was the focus of a major operation called Operation Edit.

"Mr Hendon's sentencing for his part in these offences is another milestone in a very successful joint operation," SFO director Julie Read said today.