Kloogh was appealing a sentence of eight years and 10 months imposed after he plead guilty to multiple theft and fraud charges in Dunedin District Court earlier this year.
Kloogh ran a Ponzi scheme which defrauded his unwitting investment advice clients out of at least $12 million — the Official Assignee is still trying to untangle the accounts of Kloogh’s insolvent firms to assess how much money he stole.
Sarah Saunderson-Warner, for Kloogh, said the starting point of 13 years for time to be served adopted by Judge Michael Crosbie was manifestly excessive when compared to similar cases, and insufficient regard had been given to Kloogh’s mitigating factors.
Judge Crosbie boosted his starting point due to factors such as breach of trust, vulnerability of Kloogh’s victims and the devastation on them, but Ms Saunderson-Warner argued those factors had already been taken into account by the judges who imposed sentence in the benchmark cases Judge Crosbie based his reasoning on.
The judge had also not given sufficient weight into the help Kloogh had given the Serious Fraud Office and insolvency staff, including handing over documents and computer files, Ms Saunderson-Warner said.
The judge also did not give enough credit for Kloogh attending all restorative justice conferences he had been asked to attend and having apologised in person to all those victims, she said.
Ms Saunderson-Warner also argued that while Kloogh accepted that a minimum period of imprisonment was appropriate, the starting point should have been 50% of his full sentence rather than the 60% adopted by Judge Crosbie.
For the Crown, Robin Bates said the key factor in sentencing was whether the judge adopted a starting point which was reasonable given similar cases, and argued that was what Judge Crosbie had done.
Kloogh’s offending destroyed friendships and was a gross breach of trust, which featured pre-meditated targeting of vulnerable people.
"Those were factors which took the offender’s culpability to a high level.’’
Kloogh had stolen client’s money for several years so should not be considered a first-time offender, Mr Bates said.
Justice Rachel Dunningham called for submissions from both lawyers to clarify whether the sentencing judge had imposed a reparation order on Kloogh or not.
She reserved her decision until those submissions had been filed, expected to be early February.
