A High Court decision has ruled on side with the liquidators of the Ross Asset Management ponzi scheme - which will see affected investors and creditors paid back on equal terms.
In the High Court in Wellington yesterday, Associate Judge Kenneth Johnston made a number of orders on how to distribute the funds held in two separate entities.
He settled on a proposition put forward by liquidators John Fisk and David Bridgman, of PwC, ranking investors and unsecured creditors equally and treating the Ross group entities as one pool of assets.
Up to $17.5 million would be divvied up among 665 investors and creditors on the same terms.
In the judgment, released today, Judge Johnston noted evidence from Fisk that showed distributing the company assets and the trust assets on different bases would add considerably to the costs involved in the liquidation.
As a result, he saw little advantage in ordering a hybrid distribution model that would reduce the assets available to claimants.
"I do not accept that there is anything more inherently equitable or fair in distributing the trust funds that are available in accordance with either the net contribution model or the alternative distribution model.
"I am inclined to favour the algorithm that benefits the greater number of claimants - which is the net contribution model ... But frankly, there is very little in it.''
Despite the judge's comments, a support group for victims of the ponzi scheme said hundreds of people would be losing even more money.
Spokesman for the Ross Support group, Bruce Tichbon, said they felt other methodologies would have been better options.
"The court rejected distribution methodologies that were far fairer and would have reduced the disparity between the groups.
Tichbon said the judgment "defies commonsense and fairness''.
It meant that the money collected by the liquidator would be distributed to investors who have a claim, on the same basis.
"The effect will be that one group of investors will get, on average, about 65 per cent of their stolen money back and a far larger group of investors can only expect about 14 per cent of their stolen money back.
"The better return of the smaller group will occur because money stolen by Ross has effectively been transferred from one group to the other.''
The Ross Asset Management Investors Group went into liquidation in 2012 when investigations discovered it was really a huge ponzi scheme established by David Ross.
He is in jail serving a 10 year and 10 month sentence.
Between 2000 and 2012 he reported false profits of $351 million from fictitious securities trading in what's still the country's biggest fraud committed by an individual.
In reality, the $125 million of real funds were frittered away before it ultimately collapsed. Ross is still serving his 10 year, 10 month jail term.
The judgment said of the 860 Ross Asset investors, there were 639 deemed to be shortfall investors who withdrew less than they invested, collectively claiming $124.7 million. Another 26 people were unsecured creditors owed about $68,000.
- additional reporting: BusinessDesk