The Serious Fraud Office New Zealand has started an investigation into the Brockstar Group's operations in the country.

The Brockstar Group, which is controlled by Californian businessman Brian Willis, is facing accusations for charging high upfront fees on loans that were not handed out to the customers. The company's name surfaced during the trial of Jacqui Bradley and that into Derivatek. The investigations are looking into B'On ponzi scheme of Bradley that took away $14.4 million of clients funds.

Both these funds had applied for loan packages of $20 million, which came with upfront fees of $1.3 million. The funds paid the upfront fees using the client's money but never received the loan from the Brockstar Group.

Bradley had claimed that she intended to use the loan amount to start replaying clients and not receiving loan amount speeded up the fall of her firm. She has been sentenced to seven years and five months in prison because she was found guilty of 71 counts of fraud. The Orange County Superior Court had awarded an investor US$837,000 in damages and had described Brockstar's loan business a `classic con game'.

Brockstar Group has responded by saying that the failure to pay the loans or return the fees was mainly due to third parties and the global financial crisis.