Former financial advisor Kristofer Ridgway reveals $6B investment scam

A former senior financial adviser at a top-tier asset management firm has apologized deeply after being banned from working in the industry by the financial regulator for untrustworthy practices.

Kristofer Ridgway was a senior advisor at the Brisbane offices of the respected firm Shaw and Partners until he was fired in February 2022.

A formal complaint from one of his clients led to a company investigation that revealed that Ridgway was secretly putting millions of dollars of client money into unapproved investments, in violation of company rules.

“I don’t want to see myself as a fraud. But some of my actions lately have been horribly illegal… I’m ashamed and sorry,” Ridgway tearfully told 60 Minutes in an interview that aired Sunday night.

Dozens of investors were robbed of their savings by trusting Ridgeway, who claims he was a “middleman” in a sophisticated international scheme that raised more than $6 billion through an intricate web of shell companies.

The CEO of Shaw and Partners texted Ridgway’s wife of 35 years, Kerrilyn, explaining that he had been fired and when she confronted him, he walked out on her and their three children.

She described the experience as a “nightmare.”

“It was done by the person I trusted most in the world. And you know, there are almost decades of lies and betrayal, and for what?’

In addition to the dodgy investment scheme, Ridgway had forged his wife’s signature on dozens of documents going back years — and even legally installed her as a director of companies without her knowledge.

“We were just blown away, completely blindsided… My oldest daughter was very upset and she said, ‘What have you done? What have you done?’

‘We read something from the text we received. He just said, “Oh, they don’t understand my business model.”

“I just remember he just turned around and walked out, and that was it.”

Ridgway admitted in Sunday’s interview that he “really only thinking about myself and not about the well-being of my family and my children.’

Over Christmas, Kerrilyn agreed to speak to him again for the sake of their children, only to learn he was having an affair.

“It was just a second level of betrayal and lies,” she said.

Shaw and Partners contacted ASIC, which began its own investigation

Last week, the business regulator said Ridgeway is “permanently banned from any involvement in financial services.”

“ASIC has determined that a permanent ban is necessary due to concerns that Mr Ridgway is not fit to provide financial services, is not adequately trained or competent to provide financial services, and is likely to violate financial services law,” it said. It.

“From 2015 to 2021, Mr. Ridgway, while an authorized representative of AFS licensee Shaw and Partners, recommended that his clients invest in a range of international privately held stocks sourced from McFaddens Securities Pty Ltd.”

The scheme rewarded Ridgway with a 17 percent commission for each new investor and was completely separate from his work for Shaw and Partners, with the disgraced financial adviser saying he “wanted something for himself.”

He earned about $1.6 million in commissions, which are prohibited by law in the financial advisory industry, and spent the money on flashy suits, sports cars and luxury vacations.

The dodgy investment products he sold were stocks in companies he claimed were about to go public.

But they never did.

While clients were given documents showing that their money was growing, their investments were actually worthless.

Ridgeway claims the plan was carried out by shadowy international figures pulling the strings.

“They hung me to dry. I have been the scapegoat in all of this. They’re twiddling their thumbs, happy as Larry.”

ASIC said Ridgway has “promoted international private equity in pre-IPO companies including Steppes Alternative Asset Management, Trinus Impact Capital and ASAF Critical Metals and its Australian subsidiary Aus Streaming Limited, which is now in liquidation.”

The companies are all registered in tax havens such as the Marshall Islands.

Hired to run Aus Streaming Investments by those behind the plan, veteran auditor Stephen Helberg said it appeared on paper as a healthy proposed mining operation.

But when he looked closer, he realized that the company had no money and no assets.

“The asset value on the balance sheet was $138 million.”

“And as I progressed, I realized about six months later that there’s absolutely nothing about the assets that they actually reported on the balance sheet.”

He began to unravel an intricate web of holding companies, cross holding companies, and shell companies that claimed to be worth $6.7 billion on paper, but all had questionable financial statements.

He quit in 2017 and called in his lawyers, claiming he owed about $250,000 in unpaid salary.

It is alleged that Ridgway’s behavior has affected about 40 customers and about $3.5 million has been poured into the products, which have not been approved by Shaw and Partners.

Ridgway claims that even he doesn’t know where that money is now.

He said when he first heard about the plan he thought it was legit, but when he started having doubts he doubled down.

‘Because you’re so down in the dumps… You don’t really know what else to do, you know, so you just cling to these ideas that it’s all going to be okay and people are going to make money. , and you stick your head in the sand.’

“Eventually that doesn’t work anymore.”

Shaw and Partners has said that while Ridgway worked on the under-the-table plan, they are looking into potentially paying back the clients he defrauded.