FF Traders directors deny role in alleged $3m fraud

Two company directors have pleaded not guilty to charges of conspiring to defraud investors of up to $3 million.

Phyllis Mareroa and Tina West, two of the four former directors of investment company FF Traders, whose trial began at the Auckland District Court yesterday, pleaded not guilty to Serious Fraud Office (SFO) charges of "conspiracy to defraud and using documents with intent to defraud".

The SFO alleges that Mareroa and West, along with their two associates, enticed investors, mainly friends and family, with promises of returns of up to 5 to 10 per cent a month and 50 per cent on year on their investments.

SFO lawyer Philip Morgan, QC, said FF Traders received just under $4 million from the public between November 2000 and June 2003, of which they invested only $924,650.

Mr Morgan said the accused lost half of their investors' funds in "extraordinarily risky and speculative high-yielding investment schemes" and took the rest as personal incomes and for the company's operating costs.

The two remaining directors of the former company have also been charged. Details of their cases were suppressed by the court until after Mareroa and West have been tried.

The trial is expected to take up to four weeks.

- NZPA