QV records show his company Az-Iz Rentals bought 51 Lynton Rd, a ramshackle Mt Wellington house, in a private sale in February last year for a bargain at $100,000 below CV.
It was on-sold through Barfoot & Thompson in June for $1.255 million. No renovations were apparent.
The Waikato-based former owners, Jack and Walter Tata, both in their 70s, say Hughes was helping them to sell the old family home, bequeathed in their parents' will, before offering to buy it.
They were stunned to learn of its massive resale price.
Barfoot immediately terminated Hughes' contract when alerted by the Weekend Herald to the private transaction this week and advised the Real Estate Agents Authority.
The authority confirmed it was now investigating the matter, but said Hughes was already under investigation and facing two misconduct charges before the Real Estate Agents Disciplinary Tribunal "that also relate to on-selling".
"In light of this new information we are carefully reviewing our approach in the current proceedings, including whether it is appropriate for us to apply for an interim suspension of his licence, until a decision on the misconduct charges is made by the Tribunal," a spokeswoman said.
She refused to give any further details about the misconduct charges as the matter was under investigation.
Barfoot director Peter Thompson confirmed he was aware of the earlier matter but was unable to comment while it was before the authority.
"Obviously at that time we had interviewed him. We didn't terminate his contract, which shows we didn't think it was serious enough and we referred it to the REAA."
Thompson said the earlier matter involved a complaint about another individual but Hughes was partly associated.
"It is certainly nothing in the extreme as we've seen on this occasion."
The Tata brothers have prepared a formal complaint about Hughes and their Hamilton lawyer Peter Jefferies is now preparing a civil action against the agent.
It is understood an REAA investigator will fly to Auckland early this week to speak to Barfoot representatives before heading south to interview the Tatas and Jefferies.
Hughes has so far declined to comment.
Property records show he owns a $1.3 million five-bedroom 305sq m home in Flatbush. He has also directed several companies and owned a number of Auckland investment properties.
Labour's housing spokesman Phil Twyford said a string of cases highlighted by the Herald in recent months was damaging public confidence in the real estate profession.
Suspending Hughes' licence was logical, given the allegations against him.
"I'm surprised the REAA don't move quickly to suspend agents in these circumstances."
