Philip Cavanagh. Photo / Supplied
The Serious Fraud Office has charged a man allegedly involved in an elaborate $10 million property scam which saw him banned as a real estate agent for life.
Philip Julian Cavanagh was permanently barred from selling property in December after a Real Estate Agents Licensing Board ruled he was part
of a valuation rort.
A disciplinary hearing heard evidence that the 40-year-old inflated house values in the booming Auckland market, convincing banks to lend more than the properties were worth, then selling the properties to make a profit.
The banks failed to question the deals and ask for a property valuation because the applications came from Cavanagh, a Barfoot & Thompson real estate agent, on the firm's trusted letterhead.
The company discovered the alleged deception and alerted the banks, who froze the finance deals, then suspended Cavanagh. He was banned as a real estate agent for life.
But the Herald can reveal that Cavanagh is facing four charges of obtaining more than $10 million of loans from BNZ, ANZ and Westpac by deception. The money was used to buy 12 properties across Auckland.
Some of the money has been recovered by mortgagee sale.
The SFO alleges that Cavanagh would apply for mortgages on behalf of a third party associate, deceiving the banks about the applicants' true financial position.
The deception also involved inflating the purchase price of the property, therefore increasing the amount of finance the banks would lend.
But the SFO alleges Cavanagh, or companies he was involved in, was the true buyer. He will reappear in the Auckland District Court on August 28.
