Barry Kloogh, the failed financial adviser who stole more than $15 million from clients in a Ponzi scheme, will not have to pay reparations, the High Court has ruled.

Kloogh was sentenced in the Dunedin District Court in July 2020, to serve eight years and 10 months jail time, with a minimum non-parole period of five years and four months, but later appealed.

In an appeal court decision released by Justice Rachel Dunningham on December 18, 2020, the reparation order was quashed.

Justice Dunningham’s decision took into account the widespread harm that Kloogh’s con had brought to his victims. Part of her statement read, “It is clear from the material before the court that Mr Kloogh’s fraud has had a profound effect on his victims, the vast majority of whom are elderly and reliant on their investments to support them in retirement.

“There was abuse of a position of trust both as a financial adviser but also, in many cases, as a friend. The victims were vulnerable and there are clear instances of Mr Kloogh exploiting them because they did vest high levels of trust in him.”

Regarding the reparations, Justice Dunningham stated, “In my view, the order for reparation was inappropriate when Mr Kloogh was to spend more than five years in prison given the minimum period of imprisonment imposed, and where all parties accepted it was highly unlikely that funds would be available at any point in the future. Indeed, I consider to make the order is to raise false hope in the many victims of Mr Kloogh’s dishonesty.”