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Mr Evan Paul Cherry (53) today pleaded guilty in the North Shore District Court to four charges laid under the Crimes Act by the Serious Fraud Office (SFO).
The charges relate to the misapplication of investor funds and false statements in investor reports by Mr Cherry while he was the director of Albany based investment and financial advisors – Investment Solutions Limited, ISL Nominees Limited, Trading Strategies Limited, ISL Strategic Investments Limited, and ISL Strategic Investments 100 Limited.
The ISL companies received approximately $9 million from an estimated 175 investors.
Between January 2001 and February 2007 when the majority of offending occurred, approximately $5 million of funds was invested contrary to investment instructions. The majority of the investors involved had transferred to investments offered by Mr Cherry’s personal advisory business from those of a large institutional investment company when he terminated his association with that institution.
SFO Chief Executive, Adam Feeley, said the case illustrated the importance of looking beyond personal connections and carefully assessing the risk of investments.
“The high level of trust associated with personal relationships reduces any questioning by the investor when presented with a change in the underlying nature of the investment. It can be a dangerous arrangement that clouds judgement”, he said.
The SFO acknowledge the assistance of the Financial Markets Authority (FMA). The Securities Commission (the predecessor to the FMA) referred this matter to the SFO in May 2011 having completed the initial analysis, resulting in an SFO investigation being commenced in June 2011.
Mr Cherry will be remanded in custody until sentencing on 11 December.