Two firms which Mr Kloogh was sole director of, Financial Planning Ltd and Impact Enterprises Ltd, were placed into liquidation in August.
A liquidator's report released a fortnight ago estimated at least 170 clients were owed between $12million and $14million.
Lawyers acting for a group of affected investors believe further investigation will find both totals are higher.
While unravelling the financial affairs of Mr Kloogh's companies would take months, Geoff Mirkin, of Dunedin law firm Wilkinson Rodgers, said lawyers working on the case had serious concerns that there were inadequate safeguards in place to prevent a similar situation happening, and new laws coming into force next year would offer little better protection for investors.
''It appears to us, as lawyers, that the new legislation doesn't do anything,'' Mr Mirkin said.
''There is no fidelity fund, there is no compulsory audit of every company that an authorised financial adviser is a director or a shareholder in. Why not?
''We can't see that there will be a system in place that will stop this happening again.''
The liquidator's report said the companies operated as a Ponzi scheme controlled by Mr Kloogh - whose status as an authorised financial adviser has been revoked by the Financial Markets Authority.
The Serious Fraud Office is also investigating Mr Kloogh.
No charge has been laid.
The new laws were promoted by Commerce and Consumer Affairs Minister Kris Faafoi, who said at the time that they would protect consumers.
Mr Faafoi was approached for comment yesterday morning; a spokesman said he would not be able to respond to Otago Daily Times questions until today.
Mr Mirkin said clients the legal team had worked with had no inkling that Mr Kloogh's business was anything other than financially sound.
However, the demise of FPL and IEL called into question how extensively financial advisers were audited, given professionals such as lawyers had to have their business accounts, trust accounts and partner accounts scrutinised, at their own expense, Mr Mirkin said.
''Why doesn't the system work that, if you are a registered AFA, everything is checked?''
Mr Mirkin has convened what is becoming a sizeable group of lawyers who have agreed to act at no cost on behalf of people who have lost money in the demise of Mr Kloogh's companies.
The group includes Goldsmith law principal Fraser Goldsmith, insolvency lawyer Trevor Laing, property lawyer Susie Staley, and an unnamed QC.
''The whole thing has become massive,'' Mr Mirkin said.
''It is a large group of lawyers but that is what it is going to require, because this thing has now become huge.''
Mr Mirkin described the people the lawyers were acting for as a cross-section of the community.
Many were long retired and several investors had lost their life savings.
Some had been forced to return to work.
''They weren't receiving high interest rates; most of their investments were what anyone else would get if they went to a bank to invest, except as a group going in they might get a small extra advantage,'' Mr Mirkin said.
''The people we have seen, the impact on them is massive.
''They have empathy and kindness for each other, and they are a really decent bunch of people.''
