'Knight' owes millions, say investors

A man investors say owes them millions of dollars is pumping petrol in Otaki, north of Wellington, and says he is a knight.

However, investors want to know why he has gone unpunished after he was charged with fraud in America.

The man - "Sir Grant Cardno" - used the name Tom, and was named in 2005 by the US Securities and Exchange Commission (SEC) as being involved in a "prime bank" Ponzi scheme involving up to $550 million from more than 1400 American investors, the New Zealand Herald reported today.

He was served with a summons but failed to turn up in court and in November 2006 a Texas judge found against his company, Sovereign Capital Investments, by default.

The SEC said Sovereign was involved in fraud, deceit and a deliberate or reckless disregard of regulatory requirements which led to investors loss of funds.

Others involved in the company went to jail but Mr Cardno avoided punishment and that infuriated investors, the newspaper reported .

The investors said some of Mr Cardno's New Zealand victims had lost their life savings.

A home on Norfolk Island, believed to be Mr Cardno's, burnt down in mysterious circumstances in 2003. He was thought to be living at Makara Beach, near Wellington.

The newspaper said Mr Cardno claimed his knighthood was an informal arrangement from the Queen of England for his work in a Wellington soup kitchen.

He denied defrauding anyone and said his lawyer was trying to overturn the fraud judgment against him in America.

The Serious Fraud Office is believed to be investigating complaints from investors.

- NZPA