A fraudster who orchestrated an elaborate $8.3 million Ponzi rip-off of "honest, hardworking Kiwis" has been jailed for seven-and-a-half years.

Lance Jack Ryan, aka Lance Jared Thompson, and his "patsy and dupe" Jimmie Kevin McNicholl sucked in 900 investors, which paid for their jet-set lifestyles, million-dollar homes and flash cars.

Ryan, 44, was jailed at Christchurch District Court today while McNicholl, 56, escaped prison with a sentence of 11 months' home detention and 350 hours of community work for his lesser role in the scam.

The court heard how the sophisticated fraud conned investors and left a painful legacy.

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As well as their anger over financial losses, including life savings, victims told of the depression, reputational damage, uncertain retirement futures, and even suicidal thoughts that the swindle has resulted in.

"Their theft didn't mean we missed out on a fancy holiday," one duped investor said in a powerful victim impact statement.

"It means that on a weekly basis we struggle to get by. It will have an ongoing effect on our lives."

The Serious Fraud Office's summary of facts said Ryan approached McNicholl in January 2014 with the idea of a "straight through processing" foreign exchange (Forex) trading platform under the name BlackfortFX.

Ryan's original plan was to sell Forex training packages for approximately $5000 linked to an employment opportunity at BlackfortFX.

Within a month, Ryan and McNicholl were "actively engaged" in its development and promotion, the summary says, with records showing they each had a 50 per cent share interest in BlackfortFX.

But when the company applied for registration as a financial services provider, the Financial Markets Authority (FMA) had concerns over Ryan's involvement.

However, McNicholl wrote back to declare that Ryan "is not and shall not be involved" with BlackfortFX, which later resulted in him being charged with fraud.

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The SFO says that, from the very beginning, the investors' money was pooled.

Between May 27, 2014, and May 15, 2015, approximately $8.3m was paid into the company bank account.

"Neither McNicholl nor Ryan transferred or paid any of the funds received from investors toward any legitimate Forex trading platform," the SFO says.

"Both McNicholl and Ryan knew that every request by an investor to withdraw money from their respective investment accounts with BlackfortFX was being paid from the collective pool of investors' funds held in the bank account."

The SFO found that Ryan personally took out at least $1.39m while McNicholl personally got no less than $709,000 of the "specifically identifiable investors' funds".

There were also "large amounts of money" spent on other personal items, including horses, motor vehicles, medical costs and travel.

McNicholl used $350,000 for a deposit on a $3.5m Christchurch property and bought a $111,000 BMW car.

Ryan used $1m as a settlement payment for a property in Helensville, 40km northwest of Auckland in May 2015.

BlackfortFX was placed into liquidation on July 24, 2015.

About 900 people, including friends and family, invested about $8.3m into what was in fact Ponzi scheme.

Ryan admitted charges of false accounting, forgery, altering documents, and theft by person in special relationship. McNicholl pleaded guilty to one charge of obtaining by deception.

Two victims were in court today to hear that Ryan's $205,000 Bentley car was recovered by liquidators, and he extracted $1.4m that he had put into a family trust for a property.

BlackfortFX liquidators said investors would only get 34 cents on the dollar back from any assets recovered.

The Crown said it was a Ponzi scheme from the outset, with no foreign exchange or investments made. All of the alleged profits were fictitious, SFO prosecutor Philip Gardyne said.

Registering as a financial services provider gave the scheme "legitimacy", Judge Farish said, and helped suck in investors.

The impact of the scam will remain with victims for a very long time, Gardyne said, in what was a significant abuse of trust and authority.

Many victims introduced friends and family to the scheme.

They told the court just how their lives have been devastated by the con.

"We are not faceless, obscenely rich individuals," one wrote in a victim impact statement, saying they were ordinary, honest, hardworking Kiwis.

"The money we invested, we worked incredibly hard for."

A small group of investors are in ongoing asset recovery action with liquidators.

The Crown said Ryan orchestrated the scheme and are sceptical of his claims he is remorseful.

Defence counsel Tim Fournier said Ryan doesn't accept it was a Ponzi scheme from the get-go.

Ryan, who is bankrupt, claims he is a changed man and will set up a trust on his release which will give money back to his victims.

But Judge Farish described those claims as "quite ridiculous and not realistic".

McNicholl's lawyer James Rapley said he was remorseful and sorry for his "discreet but important" role that had "devastating consequences".

The fact that the trained butcher came from humble beginnings and he was a hard worker should give the court comfort that McNicholl will "do what he can" to help repay the stolen money.

Judge Farish also ordered McNicholl to repay $50,000, at a rate of $10,000 a year, which she described as a realistic amount.

SFO Director Julie Read said Ryan's sentence reflects the very serious nature of his offending.

"He cynically manipulated vulnerable and trusting investors, many of whom have suffered considerable stress in additional to financial loss. Some of the lost money was payouts from the Earthquake Commission," she said.

"Mr Ryan also deceived the Financial Markets Authority and the Companies Office. The prosecution of such matters is an important aspect of protecting New Zealand's reputation as a safe place to invest and do business."

FMA general counsel Nick Kynoch said McNicholl and Ryan caused "serious distress and harm" to investors.

"We are pleased that they have been successfully prosecuted and held to account for their actions, while acknowledging that hundreds of people remain out of pocket," he said.