A convicted fraudster has won the right to hold on to her KiwiSaver funds - and one commentator says that may well be just, because criminals ultimately need retirement money too.

Joanne Harrison was jailed for three years and seven months in February after she fleeced the Ministry of Transport of $726,000 while employed as a general manager.

The police have made a bid to seize her assets, including $109,000 in a KiwiSaver fund.

Lawyers squared off over the KiwiSaver funds.

But a judge has ruled they can't form part of the police application, as the court has no power to make a civil forfeiture order in relation to the KiwiSaver funds.

The head of the Criminal Bar Association says it seems unjust, and a bigger issue if criminals use the protective status of the savings scheme nefariously.

But lawyer and blogger Graeme Edgeler isn't so sure.

"I mean, there's the question of 'well, someone's a criminal they've got to got to prison for a while', but at some point, they're going to retire and they should be able to have a life when they do."