The Crown has signalled that it may again seek a prison sentence for former Lombard Finance executive director Michael Reeves before a Court of Appeal hearing winds up.
Crown lawyer Colin Carruthers QC told the court on Wednesday that the Solicitor-General wanted to add home detention to the community service sentences already imposed on three former Lombard directors - former government ministers Sir Doug Graham and Bill Jeffries, and Lawrie Bryant.
"That's certainly put forward for (Graham, Jeffries and Bryant) but the Crown takes Mr Reeves' case into a more serious category than that," Mr Carruthers said.
Graham and Bryant each received 300 hours community service and were required to pay $100,000 each in reparation, while Jeffries and Reeves were sentenced to 400 hours community service last year.
They had been found guilty of making untrue statements in investment documents and advertisements in late 2007 and early 2008, and the Crown had initially sought jail terms.
The 4400 Lombard Finance investors were owed $127 million at the time of the receivership in April 2008.
The failed company's major asset was a property loan book of 27 loans with a book value of $136.8 million, mostly for bare land subdivisions or development properties. Of the 27, only nine were first ranking security.
The Crown's appeal over sentencing is due to be heard on Thursday, following three days of submissions on the former directors' appeals against conviction.
Their lawyer, Jim Farmer QC, on Wednesday outlined the lengths they went to in seeking advice on Lombard's loan book and also the way the prospectus characterised the risks.
He agreed with the court that conditions in the finance sector were worse in 2007 than 2006 "but still not of the magnitude that created the sort of panic of 2008".
Mr Carruthers said the appellants had mounted what was "effectively a rerun of the arguments at trial which were carefully considered by the judge".