Former NYSE manager also banned as director for 10 years
Former New York Stock Exchange manager Charles Schmitt has been sentenced by the High Court to 41/2 years in jail and was banned as a company director for 10 years for false accounting in a HK$363 million hedge fund fraud.
The sentence came after Schmitt, 61, last month pleaded guilty to 19 charges of false accounting related to forging accounting documents and quarterly statements to cover a loss of HK$363 million on his CSA Absolute Return Fund.
Deputy High Court Judge Esther Toh Lye-ping said Schmitt was the mastermind of the 'well planned and sophisticated' fraud as she gave the jail sentence yesterday.
Schmitt had taken advantage of the trust of investors who put money into the funds he managed, the judge said. Instead of investing for clients, he used part of the money for his own pleasure by spending US$3.1 million to buy a property in Hawaii.
'This is a very serious case and involves a large amount of money. It has affected public confidence in the local fund industry and has shaken the image of Hong Kong as an international financial centre,' Deputy Judge Toh said.