The Shareholders Association says investors are better off trying to get their money back, than seeking jail time for Hanover Group owners and directors.
The Financial Markets Authority filed civil proceedings against the directors and promoters of Hanover Finance, Hanover Capital, and United Finance on Friday.
The action involves $35 million worth of investments made between late 2007 and March 2008.
Some upset investors want criminal charges brought against those named in the proceedigns - Mark Hotchin, Eric Watson, Greg Muir, Sir Tipene O'Regan, Bruce Gordon and Dennis Broit.
But Shareholders Association chairman John Hawkins says the civil penalties involved are severe, and it's the best chance investors have in recouping their losses.
He says penalties in civil cases are higher than in criminal cases, other than the fact people can't be sent to jail.