Broker sentenced to jail

Ian Ludwig, a former director of NZ Home Loans Auckland Central, pleaded guilty this year to seven charges of fraud, which amounted to a total loss of $1.3 million.

He talked people into parting with money, thinking they were buying short-term bonds yielding 12 per cent a year. But he failed to tell them the risks and the money went into his own account, from which it was spent on his personal and business expenses. Ludwig declared bankruptcy in 2010.

His lawyer argued that his actions were a result of the global financial crisis.

Some of the seven investors who lost money read victim impact statements in court, media said.

One said he had intended to use the money for a home to give him security in his old age. Another said she had become a burden to her children, who have to give her money to get by.

Another, a woman who was working in Iraq to save money to provide for her son, said: “Ironically, the real danger for me didn't turn out to be Baghdad but Auckland ... I trusted him, but here I am."

"You have taken from people who, as with most people, worked very hard indeed to gather together those funds,” Judge Rob Ronayne said.

"You have wiped out retirement savings for people at an age and at a stage who are not able to recover from that."

Ludwig was sentenced to four years and nine months in jail.

His fraud was discovered when suspicious clients called New Zealand Home Loans to complain. A forensic accountant was hired and the matter was referred to the Serious Fraud Office.