A court has been told that investors had their life savings wiped out when a precious metals trading company collapsed owing about $2.5 million.
Robert Kairua was a director of Grace Holdings, which traded under the name Bullion Buyer.
He appeared in the Auckland District Court today, where he was sentenced to three years and nine months jail.
He had earlier pleaded guilty to 22 charges laid by the Serious Fraud Office (SFO) - nine of making false statements and 13 of theft by a person in a special relationship.
Kairua, whose full name is Kairuaiti Tangata Oropai Robert Kairua, held a 50 percent stake in the trading company, which collapsed in 2012.
The SFO accused him of making false statements about himself and the company to solicit investors. It also said funds were applied for purposes other than what was promoted.
Kairua represented himself for his sentencing with the help of an amicus lawyer.
He admitted in court today that he did lack experience as a precious metals trader and that this "did not help the company's position".
But Kairua said he had regular input from a professional, and believed he was duped himself and that others should be in court with him.
He said none of what happened was intended but also said he understood there were consequences for not properly running a company.
Kairua said he did not know the true financial position of the company when he should have, and he knew information on its website was wrong.
Investors tell of losses
Nick Williams, acting for the SFO, said the trading company ran a bogus and fraudulent scheme from the outset.
He said Kairua tried to cover up his losses by using new money to pay investors, and lied to them about the states and balances of investments.
One investor, Rose Fraser, said she lost several hundred thousand dollars and what Kairua did was a huge breach of trust.
"You just fall into a trap and you think you trust somebody. It just breaks your confidence and your trust in people."
Another investor, who did not want to be named, said he lost $250,000.
"Now I'm back to renting a house. I can't own my own home again. That's over. So that's not a good feeling - not much security left in my life right now."
Judge Chris Field told Kairua the scheme was ponzi-like and developed into a series of untruths, false statements and misappropriated funds.
He said investors had their life savings wiped out, had to re-mortgage properties and lost everything they had spent many years working for.
"The offending has been characterised as significant offending, over a significant period of time, as being relatively sophisticated and resulting, as I have said, in considerable losses."
Judge Field said Kairua's breach of trust was significant, and investors relied on him to provide accurate and responsible advice.