'Punch to the stomach': Kloogh payout 2.5c in $1

Barry Kloogh Photo / ODT

People whose life savings were stolen by convicted fraudster Barry Kloogh will probably get back only 2.5c of every dollar they had taken from them.

Kloogh, jailed in July 2020 for eight years and 10 months on multiple frauds and theft charges, ran a Ponzi scheme that embezzled at least $15 million from those who trusted the registered financial adviser with the money they had set aside for their future.

The six-monthly report of the Official Assignee into Kloogh's companies was released yesterday and provides the first official assessment of how little of their stolen money they might recover.

The report confirmed the frozen profits of a real estate transaction completed by Kloogh just before the Serious Fraud Office raided his office in 2019 — $455,442, plus interest — would be pursued by the liquidator and court documents had been lodged.

The majority of the funds that enabled the equity in the property came from funds stolen from investors, the report said.

"It is hoped that the matter may be settled without a formal court hearing, and if the funds are received .. the Official Assignee will review and vet the claims of investors.

"Even though the funds are in excess of $455,442, the total amount of loss to all investors is around $15,000,000. Therefore after costs, the anticipated return to investors will only be around 2.5c in the dollar."

The identities of most of the hundreds of people who Kloogh stole from were suppressed by the courts.

One investor said while they had expected to get little or nothing back, it was still like a punch to the stomach to see that fact in print.

"I just hope he's sitting there contemplating the extremity of his crime," another investor said.

Karyn Churcher, whose late husband's life insurance payment was stolen by Kloogh, said the news was disappointing and investors were still considering all options.

"Any news is difficult to absorb as it brings it up again."

The report confirmed the Official Assignee was still considering pursuing investors who might unwittingly have been paid out with stolen money by Kloogh.

"An analysis of the movement of money between accounts of the company, of a related company, and the director Barry Kloogh's personal accounts has been substantially completed.

"Apart from the funds held in trust ... this did not reveal any realisable assets or avenues of recovery from any voidable insolvent transactions," the report said.