The Financial Markets Authority (FMA) has decided not to take legal action against four finance companies because it says it would not have been worth pursing them.
The companies are Allied Nationwide Finance, Equitable Mortgages, LDC Finance and Irongate Property, which are all in receivership or liquidation.
Financial Markets Authority chief executive Sean Hughes said his organisation found some evidence that the companies had breached the Securities Act, and the directors have been formally warned.
Better disclosure should have been made by the companies to ensure investors were aware of the risks of investing in them, he said.
But the FMA had to weigh up the likelihood of success, existing returns to investors and the use of public resources to pursue the cases.
"We've looked at our resources, we've looked at the strength of the cases and we've asked ourselves 'what new messages would they send if we were to take them on, leaving aside questions of adequacy of evidence'," he said.
"At the end of the day, we've made the hard decision - and I emphasise it is a hard decision - that these cases do not merit further expenditure of public funds.
"They don't merit us taking on the risk of running an action that may not be successful and further diversion of our resources and time away from actions and issues that are happening in the market today."
The FMA had successfully prosecuted 32 finance company directors in the past few years. The companies involved included Five Star, Nathans and Bridgecorp.
The four cases it had decided not to proceed with "simply don't stack up" against that list, Mr Hughes said.
Investors in the companies would get most of their money back through the retail guarantee deposit scheme.