A woman who lost her husband to cancer while being defrauded of more than $700,000 by Barry Kloogh has labelled his actions "despicable" and fails to understand how he could be so cruel to a dying man.

The woman was the first of a number of investors who are this morning giving victim impact statements at the disgraced financial adviser's sentencing at the Dunedin High Court.

Kloogh has pleaded guilty to multiple charges stemming from his theft of at least $15.7 million from hundreds of clients.

A full day has been set aside for the hearing.

Advertisement

The woman said the way Kloogh had stolen money from herself and her late husband was "despicable".

"It was a well-executed plan to lure us in, one which he had probably used many times before."

The couple invested money set aside for the holiday of a lifetime, savings and an inheritance, hoping to set the family up financially after her husband was diagnosed with cancer.

The woman said her late husband was happy the family would be provided for.

"The only thing that you could think of was how to get more money out of us . . . we thought you were helping us but the only thing you wanted to do was help yourself.

"How you could do that to a dying man I still cannot understand."

The couple lost $712,000 to Kloogh.

"Cancer is cruel but Barry has matched that cruelty."

Advertisement

A second investor told the court he and his family had $268,000 stolen by Kloogh.

Their initial investments had been moderately successful: "we now feel we were being groomed."

Their money was knowingly and deliberately stolen, he said.

On three occasions Kloogh had at been at their table and been given cheques stamped to be invested safely - instead they had been later counterstamped with the name of one of Kloogh's companies.

"We are shattered that our trust in Barry has been betrayed . . . our vision has been stolen."

A third investor, a woman, said twice she had been asked by Kloogh to write cheques to transfer sums which he said had been mistakenly placed in her account.

Advertisement

She asked Kloogh to arrange her finances prior to her retirement, and received modest regular amounts.

A trip to the United States saw her stranded, after a promised $15,000 she had arranged for Kloogh to out into her account never arrived.

She emailed Kloogh to say she was worried about where her money was, and was anxious: Kloogh apologised and told her via email: "I am certainly not slack and certainly not dishonest," and told her the money would be transferred immediately.

The issue was sorted out, but the woman continued to trust a man who she now believed viewed her as a "sitting duck".

The money she trusted would be available to her as a backstop if needed by herself or her children was targeted by Kloogh, she believed.

"I believed I had financial safety: not so today . .. what on earth made him think he could use my money for his own purposes?."

Advertisement

Many people who once trusted Kloogh and regarded him as a friend are today opting to read out victim impact statements that detail the damage he has done.

"It's changed our lives completely," one investor who has lost a six-figure sum told the Otago Daily Times this week.

"Straight after it happened, I just went into a deep depression and I did not want to be here.

"I could just not see myself coping with the loss of all our money and the cancer I was going through, and I had to seek professional help and take medication, but it's there every day."

Many of the investors have already sat down with Kloogh as part of a restorative justice process.

"Whether there is any remorse there, I don't know. He's firmly convinced that he's going to get our money back, but how I just don't know," one investor said.

Advertisement

"He's just going to sit in prison. He's got a warm bed and a TV, and he'll get out and he'll just carry on."

Many of the investors who will attend today's sentencing are members of an affected investors group, set up to provide information and support.

The group spokeswoman said today was a significant milestone, but the work of untangling Kloogh's financial affairs would go on for years.

"I believe some people are still coming forward now ... and there are a lot of indirect victims in this, too," she said.

"I think some people will find closure, but there is still a long journey ahead for this process, not just working through this but also trying to make sure it doesn't happen again."

Kloogh was the operator and sole shareholder of Financial Planning Ltd and Impact Enterprises Ltd, and offered insurance and mortgage-broking services as well as financial planning.

Advertisement

However, rather than investing his clients' money through a secure platform — as they believed he would — Kloogh instead operated a Ponzi scheme, using newly invested money to pay off clients who requested their money back.

Kloogh's office and home were searched by police and the Serious Fraud Office in May 2019.

His companies have been placed in liquidation and Kloogh has declared personal bankruptcy.

In his interviews with investigators, Kloogh said he believed he had stolen $18 million from investors, and that he had operated his Ponzi scheme for years.

In March, Kloogh pleaded guilty to representative charges of false accounting, false statement by a promoter, theft by a person in a special relationship and obtaining by deception.

He has also pleaded guilty to four individual charges of forgery, theft by a person in a special relationship, and two charges of obtaining by deception.

Advertisement