"He [Mr Lusby] set up a fund called Lifestyles Investment Group out of Samoa, and he reportedly had this investment scheme that would deliver returns of between 28 and 30-32 per cent per annum by trading equities," he said.
"People who knew other people got involved. It started off in 2007, ticking along until October last year when Tony flew out of New Zealand to Panama.
"So these 67 investors are out of pocket for $6.7 million."
Mr Lusby said from Panama he had spoken to Mr Leewarden and hoped to return to New Zealand by the end of this month.
"It's all gone. At least 90 per cent of it was lost on the market," he told the Herald.
The money was lost over a five-year period and Mr Lusby said he wrote to investors to apologise earlier this year.
He wanted an opportunity to carry on trading in a bid to get their principal investment back.
"If I was given the opportunity to trade out of it, I'd prefer to do it. There's a possibility I'm getting jail time for this when I come and face it in New Zealand.
"It wasn't intentional ... Some of the fund were misappropriated and I made some bad business decisions."
He admitted putting more than $200,000 into a bar in Panama that has since gone bust. A further $750,000 was lost in a failed merger with another investment fund.
"I got behind the eight-ball ... I definitely haven't stolen anything. But I need to face up to the allegations and see what can be resolved. It's either that or go to jail, and then they [the investors] are going to get nothing."
Mr Lusby said he was scared of jail. He lives in Panama with his wife and twin 16-month-old sons, but would return to New Zealand on his own.
An SFO spokeswoman said an investigation was launched after Mr van Leewarden's complaint. But it was determined that none of the alleged offences took place in New Zealand.
"The office accordingly did not have jurisdiction to continue its investigation and the case was closed."
The spokeswoman said the office would assess new or additional allegations and would assist ASIC in its investigations.
ASIC spokesman Andre Khoury said he was aware of the case, but could not comment.
Mr van Leewarden, a former detective and director of investigation and security company Warden Consulting, said 20 US investors were also affected, with $1 million of investments.
"We've frozen some accounts, one in Hong Kong and one in Australia and we've mounted a number of approaches. We've been in touch with the US Attorney's Office in New York and briefed the FBI in Hawaii and spoken with the Panamanian police as well regarding a complaint. He [Mr Lusby] is very elusive, very hard to get hold of."
Mr van Leewarden said the situation was devastating for New Zealand investors. "They trusted that he would look after their money ... These are mum and dad investors who were looking for good returns in difficult times."
Some people invested upwards of $500,000 and some were struggling to meet repayments on loans taken out to invest in the scheme.
THE SCHEME
A minimum of A$10,000 ($12,550) is invested with projected returns of 28 to 32 per cent.
Investments were used in trades on the Australian Stock Exchange using a "successful" strategy applied to blue chip company shares.
Investors' funds were held for 180 days in the first instance, and then for 90-day cycles.
A monthly report was sent to each investor detailing capital balance, withdrawals, deposits and interest earned.