Australian Banker Paul Peters Jailed for 13 Years for 'Collar Bomb' Attack on Madeleine Pulver [VIDEO]

An Australian investment banker who attached a fake bomb around the neck of a schoolgirl in a bid to extort money from her wealthy family has been jailed for at least 13 and a half years.

Paul Peters, 52, attached the fake device to Madeleine Pulver, then 18, at her home in Sydney in August 2011.

It took a bomb squad 10 hours to remove the device, which contained no explosives.

Peters was arrested and extradited from the United States in September last year, following a huge manhunt. He pleaded guilty to aggravated breaking and entering, and detaining the teenager for advantage.

Peters, wearing a ski mask and carrying a baseball bat, entered the Pulver multi-million pound mansion and strapped the device onto the then-18-year-old's neck along with a ransom note, before leaving the property.

On sentencing, Judge Peter Zahra said: "The offender intended to place the very young victim in fear that she would be killed.

"The terror instilled can only be described as unimaginable."

Zahra gave the father-of-three less than the 20-year maximum sentence, as he had pleaded guilty and was suffering from depression at the time.

A Sydney court heard he was suffering psychiatric problems after the breakdown of his marriage and subsequent loss of custody over his children.

Pulver, now 19, said outside the court: "I'm pleased at today's outcome and that I can now look to a future without Paul Peters' name being linked to mine.

"For me, it was never about the sentencing, but to know that he will not reoffend. And it was good to hear the judge acknowledge the trauma he has put my family and me through.

"I realise it is going to take quite some time to come to terms with what happened, but today was important because now the legal process is over."

The judge described Peters' crime as "heinous" and a "deliberate act of extortion".

He added: "At the time of placing the device he had prepared around the neck of the victim, he would have appreciated the enormity of what he was doing and the terrible effect and consequence of his conduct upon the victim."

Zahra added that Peters "would have been aware that after he left the victim she would have experienced considerable trauma before it was determined that the device did not contain explosives.

"He would have understood, at the time, in the many hours that followed she was in fear she would be killed," he added.

Prosecutors had described the case as an act of "urban terrorism" fuelled by financial greed.

Peters was given a 10-year non-parole period as part of the sentence.