Guilty of theft of client funds
Guilty of theft of client funds
Linnet Lewis, has pleaded guilty in the Rotorua District Court today to 16 charges of theft by a person in a special relationship.
A Serious Fraud Office (SFO) investigation resulted in criminal charges being laid against Ms Lewis in November 2013.
In 2004, Ms Lewis set up a business to assist people to manage their financial affairs. She acted as her clients' agent or as a trustee for her clients' trusts, thereby gaining complete control over her clients' assets. Ms Lewis used that control to steal from her clients, in some instances using forged documents to commit the offences. Between 2005 and 2011 she stole approximately one million dollars.
SFO Director, Julie Read said, "Ms Lewis has committed a serious breach of trust against her clients, many of whom were vulnerable, elderly people with reduced capacity to manage their own affairs. The SFO is committed to prosecuting such offences which have the capacity to damage New Zealand's reputation as a safe place to invest and do business."
Ms Lewis will reappear for sentencing on 19 June 2015.
For further information
Serious Fraud Office
027 705 4550
Note to editors
Background to investigation
Linnet Lewis' clients were predominantly retirees who she met during her time with a previous employer. She provided financial services including paying bills, arranging tax returns, managing property portfolios and client investments.
On 7 June 2012 the Rotorua Police referred an investigation into the affairs of Linnet Lewis and her associated entities to the Serious Fraud Office. The SFO and the Financial Markets Authority worked together at the initial phase of the investigation and determined it was appropriate for the SFO to commence the criminal prosecution.
Crimes Act offences
Section 220 Theft by person in special relationship
(1) This section applies to any person who has received or is in possession of, or has control over, any property on terms or in circumstances that the person knows require the person -
(a) to account to any other person for the property, or for any proceeds arising from the property; or
(b) to deal with the property, or any proceeds arising from the property, in accordance with the requirements of any other person.
(2) Everyone to whom subsection (1) applies commits theft who intentionally fails to account to the other person as so required or intentionally deals with the property, or any proceeds of the property, otherwise than in accordance with those requirements.
(3) This section applies whether or not the person was required to deliver over the identical property received or in the person's possession or control.
(4) For the purposes of subsection (1), it is a question of law whether the circumstances required any person to account or to act in accordance with any requirements.
About the SFO
The Serious Fraud Office was established in 1990 under the Serious Fraud Office Act in response to the collapse of financial markets in New Zealand at that time.
The SFO's role is the detection, investigation and prosecution of serious or complex financial crime. The SFO's focus is on investigating and prosecuting criminal cases that will have a real effect on:
- business and investor confidence in our financial markets and economy
- public confidence in our justice system and public service
- New Zealand's international business reputation.
The SFO operates three operational teams; the Evaluation and Intelligence team along with two investigative teams.
The SFO operates under two sets of investigative powers.
Part 1 of the SFO Act provides that it may act where the Director "has reason to suspect that an investigation into the affairs of any person may disclose serious or complex fraud."
Part 2 of the SFO Act provides the SFO with more extensive powers where: "...the Director has reasonable grounds to believe that an offence involving serious or complex fraud may have been committed..."
In considering whether a matter involves serious or complex fraud, the Director may, among other things, have regard to:
- the suspected nature and consequences of the fraud and/or;
- the suspected scale of the fraud and/or;
- the legal, factual and evidential complexity of the matter and/or;
- any relevant public interest considerations.
The SFO's Annual Report 2014 sets out its achievements for the past year, while the Statement of Intent 2014-2018 sets out the SFO's strategic goals and performance standards. Both are available online at www.sfo.govt.nz