A former financial advisor has been sentenced to nearly four years in prison after misappropriating $1.7 million from two retired couples he had known for over four decades.
In June, Murray McClune pleaded guilty to two charges of theft by a person in a special relationship following an investigation by the Financial Markets Authority.
Between 2016 and 2018, McClune procured around $1.7 million from two sets of elderly clients who he had known for over 40 years on the basis he would invest the funds on their behalf.
Rather than investing the funds he had received, the FMA found that the money was instead spent on “various personal and business expenses, including purchasing a home in his and his wife’s name”. The funds were also spent on food and entertainment, travel and overseas expenses, wills and funeral planning, and cash withdrawals.
“While much of the funds were eventually returned to the investors, in one case the investors had to pursue court action to secure the return of some of their funds, and both investors were left with some money owing.”
McClune was sentenced to three years and seven months in prison.
The judge also banned McClune from holding directorships, management positions, and providing financial advice and client money and property services under ss 517-518 of the Financial Markets Conduct Act 2013, which McClune did not oppose.
No reparation order was made as the judge considered doing so would be futile.
FMA head of enforcement Margot Gatland said McClune’s conduct was “both deliberate and dishonest, and involved a gross breach of trust”.
“The conduct arose in the course of his role as a financial advisor; a position he used to take advantage of his clients,” she said.
“Banning Mr McClune ensures protection of the public and deters others from committing breaches.”
Previous conviction for obtaining by deception
McClune had a previous conviction for obtaining by deception.
His victim in that case was well-known to him as a good family friend, and McClune was a financial advisor to her and her late husband for over 40 years. Her husband died in 2007, and McClune advised her that he could make an increased gain on her superannuation savings which would be ready for her when she turned 65 in 2015.
Between 2009 and 2010, McClune made withdrawals from his victim’s investment funds. The total amount taken over an eight-month period was $203,500.
The funds were used for his and his wife’s personal expenses, and to pay other business associates.
The current offending occurred before he was charged and convicted for the previous offending.
