New Zealand has positioned itself as an alternative destination for Forex brokers looking to market themselves as regulated brokers. A new report has shown that a local foreign exchange trader has been charged with fraud for allegedly causing 59 investors to lose around $1.5 million.
The Serious Fraud Office (SFO) has charged Christopher John Collecutt, 57, with theft by person in special relationship, obtaining by deception or causing loss by deception, and false statement by promoter.
Collecutt traded foreign exchange on behalf of 73 investors, located both in New Zealand and overseas, the SFO said today in a statement.
It is alleged that figures in weekly investment reports emailed to investors from late 2008 onwards were false; that commission income was calculated on false profits; and that investor funds were used for personal use.
The New Zealand dollar is currently trading at 1.259 against the greenback.
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Collecutt, who used the trading name CFX, predominantly traded in US and Australian Dollars and Japanese Yen.
The SFO was alerted to the case in August last year and immediately began investigating.
“Many of Mr Collecutt’s investors were family and friends, and this highlights the fact that a personal connection with the promoter of an investment opportunity is no substitute for careful research into the risks associated with any type of investment,” SFO chief executive Adam Feeley said.
Brokers can get regulation from as little as $30,000.
Forexmagnates team will be writing a detailed report on regulations for Forex brokers in New Zealand in the next quarterly report.