Regardless of their former high-flying careers, the four men, with their generally excellent credentials, were the very reason that many investors put their savings into the company. Last month they were found guilty of making untrue statements about Lombard's position in its offer documents in December 2007.
During their eight-week trial, evidence was heard that Lombard's sales staff were still soliciting investment from members of the public in March 2008, less than a month before the decision by the firm's trustees to call in the receivers. In December, the directors should surely have known of the company's precarious position.
The collapse of the firm left 4400 investors owed $120 million. In many cases, this amounted to their life savings so it is not surprising some are now lining up behind calls for a civil action in attempts to recoup some of the funds.
Whatever sentences were passed down and however much the directors were castigated by the court was of small consolation to those who had lost their money. Equally, those who have said the directors should not have been held accountable in a criminal court at all, are pointing their compassion in the wrong direction.
Commentators and the professional classes are all too ready to excuse the multimillion-dollar misdemeanours of the well-heeled as "honest mistakes", while demanding heavy penalties for those guilty of committing petty crimes involving infinitely smaller sums.
Even so, that the four directors avoided custodial sentences is appropriate. Former National MP and justice minister Sir Douglas Graham and Lawrence Bryant were sentenced to 300 hours' work and and ordered to pay $100,000 reparation each. Another former justice minister, Bill Jeffries, and Michael Reeves, were sentenced to 400 hours' community work.
They escaped prison sentences because of a lack of criminal intent. Reeves, who had a hands-on role with the company and a past conviction under the Securities Act, and might have been expected to receive a custodial sentence, avoided it due to ill-health and family obligations. He can count himself fortunate.
Regardless, the case puts a line under the practice of companies appointing "trophy directors". It should be a stark warning to individuals, who have made names for themselves in other sectors, being seduced into gracing the prospectuses of companies with whose financial affairs they are not entirely familiar. As Denham Shale, president of the Institute of Directors, said yesterday, the case "has highlighted the fact that all who aspire to the position of company director must be diligent and need to be aware of their responsibilities . . ."
Like the earlier Nathan's Finance case, Lombard served as a reminder to the directors and their advisers, that "timely, accurate and meaningful disclosure was an obligation which could not be delayed or delegated to others" chimed the Financial Markets Authority. That is to say while ignorance of the law is no excuse, neither, for its directors, is ignorance of a company's full financial status. Further, while the calls for Douglas Graham to be stripped of his knighthood might seem harsh to some, it was just such trappings that gave investors the confidence to invest with the company in the first place.
Parallels can be drawn with other "celebrity endorsements".
Late last year there was talk of prosecuting those such as former TV One newsreader Richard Long over his endorsements of Hanover Finance - which in 2008 froze repayments to investors owed $554 million. Mr Long had featured in voiceover advertisements in late 2007 promoting the finance company. In June 2008 - one month before Hanover Finance collapsed - the Advertising Standards Authority upheld a complaint by a financial adviser, who said Mr Long's scripted statement was "grossly misleading".
The Lombard sentencing should send a chill through an industry that has in the past relied on the endorsements of the ill-informed, be they trophy directors or celebrity promoters. Too many ordinary people have suffered terrible pecuniary losses at their behest.
