A KwaZulu-Natal man has been sentenced 10 years imprisonment after he was found guilty of running an elaborate Ponzi scheme.
Patrick Stapleton, 66, was found guilty on 147 counts of fraud and contravention of the Banks Act, and contravention of the Financial Advisory and Intermediary Services (FAIS) Act.
National Prosecuting Authority (NPA) spokesperson in KZN, Natasha Kara, said between 2008 and 2014, Stapleton and his son Michael, operated a Ponzi scheme from their Hillcrest office, through their company, Dynamic Group CC.
"They approached factory employees who were either being retrenched or were retiring. The father and son misrepresented to these people that they (the Stapletons) were involved in the research and development of an off-road mining motor vehicle and a paint business known as Umbala Paints," Kara said.
She said the father and son convinced 147 people to invest with them and promised high monthly returns.
Kara added that most of the investors were manual workers who invested their retirement funds, retrenchment and/or severance packages with the Stapletons, to the total amount of R11.5 million.
"The men were arrested in 2017, and Michael, who pleaded guilty in 2019, was sentenced to five years imprisonment in terms of Section 276 (1) (i) of the Criminal Procedure Act. In court, the prosecutor, Sara Parak, led the testimonies of the complainants, as well as the evidence of forensic auditors," Kara said.
Meanwhile, Stapleton senior was sentenced to 10 years imprisonment for the 58 counts of fraud - all taken as one for the purpose of sentencing - which involved amounts of R100,000 or more and which would ordinarily attract a minimum sentence of 10 years imprisonment each.
The NPA said Stapleton was sentenced to eight years imprisonment for the 89 counts of fraud, all taken as one for purpose of sentencing, which involved amounts of under R100,000.
For the charges of contravening the Banks Act and the FAIS Act, Stapleton was sentenced to two years imprisonment on each count. The court ordered that the sentences run concurrently, resulting in the effective sentence of 10 years imprisonment.
Kara said the company, Dynamic Group CC, was also convicted of one count each, of contravention of the Banks Act and contravention of the Financial Advisory and Intermediary Services (FAIS) Act; and sentenced to a fine of R10 000 for each count. Each fine was suspended for a period of three years.
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