SFO lays charges against forex trader
SFO lays charges against forex trader
Criminal charges have been laid in the Auckland District Court today against Rene Alan Chalmers (42) following a Serious Fraud Office (SFO) investigation.
Mr Chalmers is facing a total of 15 charges of theft by person in special relationship, dishonestly taking or using document and false statement by promoter. The charges relate to his activities trading foreign exchange (forex) on behalf of clients, and to three property purchases occurring in 2011 and 2012.
In January 2007, Mr Chalmers and an associate registered Chalmers Cameron Investments Limited (CCIL) with the New Zealand Companies Office. Mr Chalmers began receiving money from family members and friends through CCIL for the purpose of forex trading.
Mr Chalmers resided in the UAE from 2007 - 2011, and from 2009, started accepting investor monies from colleagues and acquaintances. This business continued in New Zealand following his return in 2011. In May 2012, CCIL was placed into voluntary liquidation owing investors approximately USD$5,000,000.
The SFO investigation alleges that although investors believed they were giving Mr Chalmers their money for the express purpose of forex trading, Mr Chalmers was using investor funds contrary to the agreement(s) under which they were accepted and reporting false gains to investors via monthly or quarterly investor statements.
The SFO alleges that Mr Chalmers has misappropriated approximately NZD$837,046 for personal use and has overstated investors' positions by an estimated NZD$4,000,000.
Acting Chief Executive for the SFO, Simon McArley said, "This case continues the current string of investment advisor and broker cases coming to our attention. Those receiving money from others for investment need to be continually conscious of the need to use that money only for the purpose it was given to them and to be truthful when reporting to clients on the position of their investments."
Mr Chalmers has been remanded on bail and will reappear on XX.
For further information
Serious Fraud Office
027 705 4550
Note to editors
Background to investigation
Rene Alan Chalmers is a 42 year-old former teacher. In 2007, Mr Chalmers and his wife, moved to the United Arab Emirates to take up teaching roles. Mr Chalmers and his family moved back to New Zealand from the UAE in July 2011.
Mr Chalmers was a shareholder and director in the following entities:
• Chalmers Cameron Investments Limited (CCIL)
• Chalmers Cameron Management Limited (CCML)
CCIL was incorporated in January 2007 and was placed in voluntary liquidation on 28 May 2012. CCML was incorporated in April 2007 and struck off the Companies Office register on 25 August 2009.
After considering the complaints from investors, an investigation under Part I of the Serious Fraud Act 1990 was commenced on 15 May 2012. It was upgraded to a Part II investigation on 30 May 2012.
Crimes Act offences
Section 220 Theft by person in special relationship
(1) This section applies to any person who has received or is in possession of, or has control over, any property on terms or in circumstances that the person knows require the person-
(a) to account to any other person for the property, or for any proceeds arising from the property; or
(b) to deal with the property, or any proceeds arising from the property, in accordance with the requirements of any other person.
(2) Every one to whom subsection (1) applies commits theft who intentionally fails to account to the other person as so required or intentionally deals with the property, or any proceeds of the property, otherwise than in accordance with those requirements.
(3) This section applies whether or not the person was required to deliver over the identical property received or in the person's possession or control.
(4) For the purposes of subsection (1), it is a question of law whether the circumstances required any person to account or to act in accordance with any requirements.
Section 228 Dishonestly taking or using document
Every one is liable to imprisonment for a term not exceeding 7 years who, with intent to obtain any property, service, pecuniary advantage, or valuable consideration,-
(a) dishonestly and without claim of right, takes or obtains any document; or
(b) dishonestly and without claim of right, uses or attempts to use any document.
Section 242 False statement by promoter, etc
(1) Every one is liable to imprisonment for a term not exceeding 10 years who, in respect of any body, whether incorporated or unincorporated and whether formed or intended to be formed, makes or concurs in making or publishes any false statement, whether in any prospectus, account, or otherwise, with intent-
(a) to induce any person, whether ascertained or not, to subscribe to any security within the meaning of the Securities Act 1978; or
(b) to deceive or cause loss to any person, whether ascertained or not; or
(c) to induce any person, whether ascertained or not, to entrust or advance any property to any other person.
(2) In this section, false statement means any statement in respect of which the person making or publishing the statement-
(a) knows the statement is false in a material particular; or
(b) is reckless as to the whether the statement is false in a material particular.
Role of the SFO
The Serious Fraud Office (SFO) was established in 1990 under the Serious Fraud Office Act in response to the collapse of financial markets in New Zealand at that time.
The SFO operates three investigative teams:
• Evaluation & Intelligence;
• Financial Markets & Corporate Fraud; and
• Fraud & Corruption.
The SFO operates under two sets of investigative powers.
Part I of the SFO Act provides that it may act where the Director "has reason to suspect that an investigation into the affairs of any person may disclose serious or complex fraud."
Part II of the SFO Act provides the SFO with more extensive powers where: "...the Director has reasonable grounds to believe that an offence involving serious or complex fraud may have been committed..."
The SFO's Annual Report 2012 sets out its achievements for the past year, while the Statement of Intent 2012-2015 sets out the SFO's three year strategic goals and performance standards. Both are available online at: www.sfo.govt.nz