A corrupt banker has forfeited $850,000 and will now be eligible for parole sooner after being jailed for taking bribes to facilitate a $54 million mortgage fraud scheme.

Former BNZ staffer Zongliang (Charly) Jiang was sentenced to four years and nine months' imprisonment last year after being found guilty at a lengthy judge-alone trial.

Justice Sarah Katz also imposed a minimum period of imprisonment (MPI) of 50 per cent for the banker, who she said was motivated by greed.

Jiang was one of four people convicted after being charged by the Serious Fraud Office (SFO) over 76 Auckland and Hamilton properties and suspicious mortgages, involving 57 loan applications and 110 transactions.


Auckland property developer Kang Huang, described as the "mastermind and instigator of the scheme", his wife, Kang Xu, and lawyer Gang (Richard) Chen were also convicted of the crimes.

Jiang was one of two bankers taking bribes of $7000 per transaction to approve the loans, the other being former ANZ banker Peter Cheng.

The SFO also wanted to charge Cheng but he fled to China.

Jiang, however, appealed his sentence along with Chen at the Court of Appeal in February.

Today, the appeal court judges, Justice Denis Clifford, Justice Jillian Mallon and Justice Christian Whata, released their decision.

"Mr Jiang engaged in multiple acts of deception as a trusted bank employee involving $18 million in loans. He also netted $240,000 in secret payments," the ruling reads.

"We are however satisfied that an MPI was not necessary for Mr Jiang. While the starting point was justified, he was less culpable than either Mr Huang or Mr Chen. He was an otherwise law-abiding citizen."

At the Court of Appeal hearing, the judges heard Jiang had left BNZ midway through the scheme after the bank began to think something was amiss and recalled the loans.


Jiang's farewell from BNZ "wasn't on the best terms" and a non-disclosure agreement was signed, his lawyer Julie-Anne Kincade said.

Kang Huang, the mastermind of the scheme, was labelled by his wife's lawyer as a
Kang Huang, the mastermind of the scheme, was labelled by his wife's lawyer as a "megalomaniac". Photo / Michael Craig

After being targeted by a proceeds of crime forfeiture he also "effectively lost everything", including his performance bonuses for the quantity of transactions he was processing, Kincade added.

The Court of Appeal judges said in today's ruling that the forfeiture had recouped $850,000.

"Mr Jiang also submitted that it was of significance that he has subsequently consented to a forfeiture order made after sentencing which recouped $850,000.50.

"We agree with [Kincade's] submission that Mr Jiang's consent to the forfeiture orders is an important acknowledgement of wrongdoing. We also agree that the forfeiture order is an additional form of denunciation and deterrence. It does not appear [Justice Katz] took these factors into account and in our view, taken together, they justify the removal of the MPI."

The Court of Appeal judges also quashed Chen's 50 per cent MPI for his six-year prison term but dismissed his appeal of his convictions.

"We agree that Mr Chen occupied a special position of responsibility, as a solicitor, to the banks. His offending involved calculated premeditation over a lengthy period (about two years) involving bank employees at three banks.

"Balanced against this, Mr Chen's previous good character needs to be acknowledged, and the fact that unlike Mr Huang or Mr Jiang, he did not obtain any monetary benefit from the offending. In imposing the MPI on Mr Chen the Judge appears not to have had sufficient regard for those mitigating factors. In our view those factors obviate the need for an MPI. We therefore quash Mr Chen's MPI."

Both Jiang and Chen will now be eligible for parole after serving a third of their prison terms.

Kang Xu was sentenced to 12 months' home detention. Photo / Michael Craig
Kang Xu was sentenced to 12 months' home detention. Photo / Michael Craig

Huang's scheme had used his property construction company LV Park to facilitate what Justice Katz called a "premeditated and prolonged" fraud.

The group used false information and documents, or withheld information from banks to obtain property loans of more than $54m between December 2011 and October 2015.

In the summary of her verdicts, Justice Katz found Chen acted as the "middleman" between Huang and Xu while also bribing his "inside contacts" at BNZ and ANZ.

A third overseas bank was used but its name remains suppressed.

Xu, also known as Yan (Jenny) Zhang, was sentenced to 12 months' home detention, while her husband, who pleaded guilty, was sentenced to four years and seven months' jail.

During the trial, Xu's lawyer Adam Simperingham labelled Huang as a "megalomaniac" hiding his true fraudulent nature.