A serial fraudster who persuaded hundreds of people to invest more than $8 million in a fake foreign exchange brokerage has been jailed for seven years and six months, with a minimum non-parole period of three years and nine months, for charges brought by the Serious Fraud Office (SFO).

The SFO says Lance Jack Ryan, 44, has been sentenced at the Christchurch District Court. He had pleaded guilty earlier to charges of ‘Obtaining by deception’, ‘False accounting’, ‘Forgery’, ‘Reproducing a document with intent to deceive’ and ‘Theft by person in special relationship’.

Mr Ryan, also known as Lance Jared Thompson, used the forex platform BlackfortFX as a façade to encourage more than 900 investors, who were mostly from the Christchurch region, to put about $8.3 million in the Ponzi scheme. Mr Ryan has a number of previous dishonesty convictions including ‘misleading a social welfare officer’ and ‘taking or using a document for pecuniary advantage’, together with other Insolvency Act and Companies Act offences.

Jimmie Kevin McNicholl, 56, who was the public face of BlackfortFX, as well as its sole shareholder and director, was sentenced to 11 months of home detention and $50,000 reparation. Mr McNicholl pleaded guilty in May to obtaining the registration as a financial services provider by deception.

BlackfortFX did not conduct any forex trading, or any other form of investment activity.

“The sentence imposed on Mr Ryan reflects the very serious nature of his offending,” says SFO Director, Julie Read.

“He cynically manipulated vulnerable and trusting investors, many of whom have suffered considerable stress in additional to financial loss. Some of the lost money was payouts from the Earthquake Commission.”  

Arena Capital Ltd, which traded as BlackfortFX, was registered on the Financial Service Providers Register and purported to offer foreign exchange services to clients. The Financial Markets Authority (FMA) obtained asset preservation orders over the assets of Arena and associated persons in May 2015. The FMA also referred the matter to the Serious Fraud Office.

Arena was placed into liquidation at the Christchurch High Court on 24 July 2015.