Perth investor says he lost millions in alleged fraudster's ‘Ponzi scheme'
However, private investor Chris Marco has admitted he was using their money to pay returns to other clients in what one witness told his West Australian Supreme Court trial on Tuesday 'reeked of a Ponzi scheme'.
Marco is on trial, facing 44 charges after allegedly defrauding investors of about $36.4 million. His former executive assistant, Linda Marissen, has been charged with 30 offences for her alleged role in the crimes. Both have pleaded not guilty to all charges.
Giving evidence on Tuesday, Perth-based accountant Charles Napoli said he decided to invest when he became aware of Marco through one of his clients.
He invested $1 million with Marco, who promised to invest his money in lucrative overseas investment structures called 'private placements'.
Private placements are when a company raises money by selling shares, bonds, or securities to a select group of private investors, rather than through the public stock exchange.
Napoli said he was a risk-averse investor, but he was assured by Marco's promise his principle investment would be kept in a blocked bank account that had a multimillion-dollar insurance policy attached.
He said it gave him confidence that he could invest with the Nedlands-based businessman, as well as his 'experience' in the financial sector.
Napoli said Marco regularly spoke about the 'four or five years' he spent in Europe learning about private placements and investing, and how he had 'all the right connections'.
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