Former Barfoot & Thompson agents made $330,000 in eight months by inflating the value of a house in Howick.
The scheme was like the children's pass-the-parcel game, and worked well while house prices were rising.
The Real Estate Institute this week revealed the only apparently successful deal in the scam,
which cost four victims who were also agent associates about $2 million.
The deal involved ramping up the price of 163 Wellington St in Howick as the agents capitalised on the fast-rising market by flicking properties among themselves.
They listed themselves as agents for the houses but were secretly trading themselves.
The Real Estate Agents Licensing Board heard the agents were all highly successful. Phil Niall made $120,000 at Barfoot's Mt Albert last year.
The other two agents have since been granted name suppression. One was said by Barfoot's Mt Albert to be highly sought after while the other was so good as an agent that he left Barfoot's to become a project manager.
The institute wants their certificates cancelled so they are permanently barred from selling real estate.
For the Crown Law Office, Steve Haszard outlined the dealings over 163 Wellington St which he said were so slick even banks were fooled, thinking they were lending to parties unconnected to the vendors.
The Public Trust first listed the house for tender, using Barfoot's Howick office, Mr Haszard said. Faizel and Margot Jassat, immigrants from Zimbabwe, were salespeople in that office and Faizel Jassat was listing agent for the property.
But they saw the deal as too good to resist, and the listing agent became the buyer, without disclosure - an offence under the Real Estate Agents Act.
The Jassats secretly bought the house in 2006 for $540,000 and last May they sold it to Phil Niall, an agent in Barfoot's Mt Albert office, for $770,000.
Mr Niall told the licensing board he never intended to own the place.
He was enticed to buy with the promise of a $5000 bribe from the two agents with name suppression, although he never got the $5000.
At the time he bought it, the small house was valued at $555,000.
Mr Niall told the board he had never seen the house. Nor did he tell Barfoot's Mt Albert about the deal. But two months later, he was the vendor, selling it to Grace Anderson - a person apparently unconnected with the scam - for $870,000.
Mr Haszard said this was the best example of how the illegal scheme operated and the profits the agents stood to make.
PRICE RAMPING
How it worked at 163 Wellington St, Howick:
* November 2006, Public Trust sells to agents: $540,000.
* May 2007, agents sell to fellow agent: $770,000.
* July 2007, agent sells to another party: $870,000.
The house was sold to a buyer apparently unconnected with the scam for $870,000. Photo / Paul Estcourt
Former Barfoot & Thompson agents made $330,000 in eight months by inflating the value of a house in Howick.
The scheme was like the children's pass-the-parcel game, and worked well while house prices were rising.
The Real Estate Institute this week revealed the only apparently successful deal in the scam,
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