Fraud suspect denied bail in New York

A New Zealander facing fraud charges in New York has been denied bail.

Bahamas-based Derek Turner is in jail charged with defrauding investors of US$1 million ($1.4m).

He was ordered to be permanently detained on Tuesday (New York time) by US magistrate James Orenstein at the federal court in Central Islip, the Newsday website reported.

Mr Turner had been arrested for allegedly operating a phoney hedge fund by FBI agents acting with a former stock swindler turned evangelical minister.

Mr Turner's lawyer Joseph Conway had asked for him to be released on US$3.7 million bail backed by three properties he owns in the Bahamas and for him to live with a step-daughter in Seattle pending trial.

But Mr Orenstein agreed with assistant US attorney Lawrence Ferazani, who said there was too much risk of Mr Turner fleeing, Newsday reported.

Mr Turner, who was accused of collecting money by claiming his hedge fund earned 40 per cent a year, has pleaded not guilty. If convicted, he faces more than five years in prison.

Conway said prosecutors planned more charges that would lift the total he allegedly defrauded to US$4 million.

- NZPA