Ponzi scheme mastermind sentenced to 15 years for defrauding investors
Andrew Paul Futcher, 62, has been sentenced to 15 years in prison for orchestrating a Ponzi scheme that defrauded investors of over R9.2 million, promising unrealistic returns while misusing their funds for personal gain.
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A 62-year-old man has been sentenced to 15 years in prison for running a Ponzi scheme that defrauded investors.
The Parow Magistrate's Court found Andrew Paul Futcher guilty of misleading individuals with extravagant promises. Futcher operated a “get rich quick” scheme, deceiving investors with unrealistic promises of high returns. He misused the funds for personal luxuries and to pay off previous victims.
Andrew Paul Futcher was sentenced to a total effective term of 15 years' direct imprisonment for what is described as a “get rich quick” or “Ponzi” scheme, in which he defrauded investors by making extraordinary guarantees about investment returns and then used the money for extravagant purchases and to pay off other victims.
Hawks spokesperson Zinzi Hani confirmed from court documents that Futcher engaged in an investment fraud scheme from 2010 through 2011, and operated the Ponzi scheme under the name of Ablaze Trading CC.
“He solicited investments from the public to the amount of over R9.2 million. He promised and guaranteed the investors a monthly return of 10%. He traded on the stock market through the registered brokerage company, DWT Securities.
“The accused, after receiving the funds from investors, failed to invest the funds as promised with DWT on the stock market. After the investor made investments in the Ablaze Trading Standard Bank account, the accused would then pay back a portion of the victims’ money with money received from newly duped victims. The accused defrauded approximately nine victims in total,” said Hani.
The court heard that funds were also used for Futcher’s personal expenditure and to sustain the operation of the scheme.
In April, Futcher was convicted on 17 counts, including theft, forgery, money laundering, uttering, and contraventions of the Bank Act and the Financial Advisory and Intermediary Services (FAIS) Act.
Futcher was sentenced to nine years' direct imprisonment for counts 1 to 17, which related to theft.
Counts 18-90 of theft were withdrawn against the accused. For count 91 of money laundering, he was sentenced to four years' direct imprisonment.
In respect of count 92 of Contravention of the Banks Act, he was sentenced to 10 years' direct imprisonment, with the same sentence for count 93 of contravention of the FAIS Act.
On counts 94 and 95, forgery and uttering, respectively, he was sentenced to five years for each count.
The court ordered that the sentence imposed on counts 1-17, 91, and 92 run concurrently with count 93, resulting in an effective sentence of 10 years' imprisonment.
Further, the court ordered that the sentence imposed on count 94 run concurrently with count 95, resulting in an effective five years' imprisonment.
Hani said: “It is further reported that (Futcher) was already sentenced for similar offences in April 2004 to 12 years' imprisonment.”