A former finance manager involved in a multi-million-dollar Ponzi scheme targeting the Japanese community has been jailed and ordered to pay nearly $700,000 in reparations.
Yuko Hanyu, former head of finance at East Wind Company Limited, was sentenced to six years and four months in the Auckland District Court on Thursday and ordered to pay $691,000 in reparations.
She must serve at least two years and six months before being eligible for parole.
A jury found her guilty in April on four representative charges of false statement of a promoter, two representative charges of obtaining by deception and one charge of theft by a person in a special relationship.
Together with director Masatomo Ashikaga, also known as Tom Tanaka, she persuaded people to hand over money by making false claims about investment products and the returns on offer.
The pair used their standing in the Japanese community to promote investments that did not exist as described.
The Group Term Deposit and the Waterloo Fund, the products sold to investors, operated as Ponzi schemes, with money coming in from new investors was used to repay existing ones.
On top of that, Hanyu took more than $800,000 from East Wind for herself, transferring it to her mortgage account and personal credit card.
The scheme unravelled after Ashikaga died. The group collapsed in February 2019 and went into liquidation.
SFO director Karen Chang said Hanyu helped oversee a "large and incredibly complex" Ponzi scheme which deceived investors out of millions.
"Today’s sentence and the imposition of a minimum period of imprisonment reflects the seriousness of such offending, which undermines legitimate investment markets and threatens New Zealand’s reputation as a safe place to do business"
Tens of thousands of documents were analysed by SFO investigators and forensic accountants, she said.
"This included large amounts of detailed financial records, most of which were in Japanese."
Chang said many of the investors were based overseas and noted the importance of foreign investment to New Zealand's economy.
"Investors must have confidence our markets are fair, safe and well-regulated.
“The SFO will continue to prioritise cases which pose a threat to our country’s commercial wellbeing, which is particularly critical in today’s challenging economic environment."
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