Derek Turner, the Bahamas-based international securities trader who was convicted last year of running a phoney investment scheme, has been stripped by a US Federal Court of all his assets in The Bahamas and sentenced to 20 years in prison.
He was also ordered to pay restitution to his victims, according to international press reports.
In total, Turner reportedly ripped off between $55 million and $80 million from more than 30 investors.
Turner’s lawyer, Joseph Conway, reportedly said that his client’s properties in The Bahamas should yield between $10 million and $15 million once sold. That money will go towards the victims, and Turner is obligated to pay the rest, it was reported.
After investigators boosted the amount he was assessed as having stolen, the court on Friday made a final order of forfeiture in which he was ordered to hand over additional real estate located by US authorities, including assets in The Bahamas and Australia.
Judge Joanna Seybert ordered properties in the Bahamas and Australia in which Turner had an interest to be forfeited to the United States, according to international news reports.
Turner, who pleaded guilty in a US federal court in New York last August to three fraud counts, was hoping for a lesser jail term and will appeal the 20-year sentence, his lawyer told an Australian news agency.
In an initial deal with the US Federal Court, Turner was ordered to serve six to seven years in prison then be deported back to New Zealand, as long as he paid back $16 million.
Turner had moved to the Bahamas in 2000 and sought permanent residency after Australian securities regulators questioned his trading practices.
He was arrested in the US by the FBI in April last year and has been in custody since then in the Nassau County Correctional Centre in East Meadow, New York.
Turner, a native of New Zealand who lived in Nassau with his wife and children, was one of the contenders who wanted to build a futuristic replacement for the World Trade Centre after the September 11, 2001 attacks caused it to be levelled.
The FBI initially maintained that Turner swindled a father and son out of $1 million after he promised them a 40 percent annual return on their investment. Court documents stated that he assured the pair he had $500 million in the hedge fund, but it only actually contained $300,000.
Turner, who is said to own significant real estate in The Bahamas and was even in a legal battle with Iranian born Mohammed Harajchi, was in the international spotlight a few years ago after he unveiled a plan to create what would have been the world’s tallest building in the spot where the World Trade Center once stood. He even had a local company [owned by some of his cronies] build an elaborate web site to promote the idea.
According to information that was revealed in several media reports, FBI agents busted the securities trader at his office in Long Island, New York on April 16, with the help of a reformed conman, Barry Minkow, who allegedly managed to obtain inside information.
The most recent reports indicate that one of Australia’s most popular celebrity doctors, James Wright, lost more than $51 million to Turner.
According to a document outlining the doctor’s testimony and agreed to by prosecutors and the defence, Dr Knight met Turner in 1992 when Turner approached him about being a spokesman for a business.
In 1999, Dr Knight agreed to invest with Turner after being told he had developed a “sophisticated technique of trading in various equity indices and commodities in a manner that generated very healthy returns with substantial liquidity, minimal risk and no leverage.”
From May 1999 until October 2002, Dr Knight invested personal funds as well as funds from Medi-Aid, a charitable foundation that provides low-cost or no-cost housing to senior citizens, founded by the doctor’s family. He also convinced his wife to invest personal funds.
Dr Knight sent Turner funds from various companies and all the investments were sent to Turner’s bank accounts with the Commonwealth Bank, either in the name of Turning Investment or Turner Holdings, the court documents show.
Dr Knight believed his money was being invested in indexes and commodity futures and was generating a profit, and other than deposit certificates and account statements sent from Turner each month, there was no written investment arrangement between the pair.
But from March 2003 until November 2004, Medi-Aid made more than 18 requests for the return of the investment.
Turner, the managing director of Turning Enterprises International Ltd., at first maintained his innocence before eventually pleading guilty.
The Bahama Journal
