Fraud still rates as one of the highest threats to the public sector as does other forms of cyber crime. Technology has presented new challenges to Australian law enforcement and regulatory authorities and many of these challenges are yet to be overcome.
IFW’s Executive Chairman Ken Gamble and Investigations Coordinator Joshua Oastler presents an interesting case study on the growing problem of Ponzi scheme operations in Australia. The key offender behind the STC scam was identified as Peter Foster who disguised this fraud as a legitimate gambling operation. The average profits from these types frauds can range from USD $10 million to $100 million.
Often associated with boiler room, this type of serious and organised investment fraud has been largely overlooked by law enforcement agencies because of the complexity and sophistication of such scams and their clever fronts as ‘legitimate companies’. The offenders also use multiple jurisdictions to operate their websites, offices and bank accounts to evade potential investigations. These frauds run on average from six months to three years.
IFW was proactive in this case and was able to locate and freeze a large portion of the funds, around AUD $10 million dollars. A class action lawsuit was then able to form in the NSW supreme court, that will lead to the recovery of money for investors.