The most severe penalty handed down to a New Zealand real estate agent has been imposed on a former Auckland salesman.
Rajneel Raj, who worked as an agent at Re/Max Henderson Valley and was convicted of six misconduct charges for mortgage ramping, has been ordered by the Real Estate Agents Disciplinary Tribunal to pay about $100,000 in fines and compensation and had his salesman's licence cancelled.
Luke Clancy, prosecutor for the Real Estate Agents Authority, told the tribunal that Raj had made $189,000 out of the scheme after loan applications were approved at the BNZ Newmarket branch.
He used his mother's name on deals he stood to gain from financially, forged signatures, indulged in mortgage ramping and lived in a house he was selling.
Mr Clancy told the court how in each case Raj drafted a document for sale and purchase of a property but showed the price as being well above the actual offer and pocketed the difference, leaving the buyer to pay the over-inflated mortgage.
Raj was found guilty of six charges in July last year but had not attended any of the hearings, the tribunal said in a decision released exclusively to the Herald.
"That appears to be because he is suffering severely from mental depression," the decision said.
He was represented at the sentencing by Kahu Barron-Afeaki, who told the tribunal Raj was never fully aware of the fraudulent activities being undertaken by other parties he was conducting business with. He was an ill man, Mr Barron-Afeaki said.
Raj had played a relatively minor role in the offending and almost all the money was never paid to him but to three other principal parties.
The tribunal issued a severe warning to all real estate agents.
"We must impose a significant fine to denounce and deter this type of conduct by others in the industry ... The defendant's activities were appallingly fraudulent and deceptive, are an unacceptable blot on the real estate profession as a whole and cannot be tolerated," the tribunal said.
REINZ chief executive Helen O'Sullivan said she was delighted with the decision.
"Anyone contemplating similar behaviour should take note ... The industry wants to see behaviour like this stamped out."
• Salesman's licence cancelled.
• Real Estate Agents Authority fine: $20,000.
• Real Estate Agents Disciplinary Tribunal fine: $2000.
• Party 1: $11,995.42.
• Party 2: $12,579.04.
• Party 3: $65,000.
Source: Real Estate Agents Disciplinary Tribunal