31 Mar 2009

NZ-registered company accused of Ponzi scheme

9:17 pm on 31 March 2009

An American man is being pursued by hundreds of angry US investors who are seeking money from one of his companies which was registered in New Zealand.

Jeff Lowrance is being sought by more than 500 investors, whose lawyers claim he was operating a giant Ponzi scheme, or pyramid scheme, part of which was based in New Zealand

One of Mr Lowrance's companies, First Capital Savings and Loan, had its registered office in Auckland.

A lawyer in South Dakota acting for 220 of the disgruntled clients, Wanda Howey-Fox, says some people have lost as much as $US750,000 and had invested their life savings and college education funds with Mr Lowrance.

Ms Howey-Fox says she is also seeking punitive damages on behalf of the investors, with the total claim amounting to $US120 million. The lawyer says she has not yet managed to serve papers on Mr Lowrance.