'Sordid' affair, blackmail - and now jail

The man and the mistress met online in 2005. She travelled to Dunedin and a sexual relationship began between the pair. Photo / File

Man and mistress sent to prison for their parts in fraud which cost family home.

A Dunedin man's "sordid" affair has ruined his marriage, destroyed his family's financial security and caused his defrauded wife to question the past decade of her life.

The formerly self-employed financial and insurance adviser and his one-time mistress were jailed yesterday for their parts in a fraud which resulted in the sale of the man's family home and the loss of his wife's retirement fund.

The pair were jointly charged on seven counts of fraudulently using a document. The 52-year-old man was charged on two further counts of forgery and the 35-year-old mistress was charged with blackmail.

Judge Michael Crosbie sentenced the woman to four years' jail for her "extraordinary" blackmail and the man for two years and three months.

The man's wife told the Dunedin District Court she knew nothing of her husband's "double life" until September last year. She received a phone call from the mistress' mother after police arrested the woman.

"The whole sordid story started to unfold," the wife said during her victim impact statement. "For 10 years, [he] had shown no signs of his double life."

The man's "despicable lie" had cost his wife her savings of $78,000 - as he had forged her signature to access funds - and the family its home - as he extended the mortgage to fund his payments to the blackmailing mistress, the wife told the court.

"[He] had stolen all my money - 27 years of careful saving. How low can you go to steal from one's wife?"

The man and the mistress met online in 2005. She travelled to Dunedin and a sexual relationship began between the pair.

After returning to her North Island home, the 35-year-old woman discovered he was married, and she began to blackmail him, threatening to reveal the relationship to his family.

She handed herself into police in 2010. As a result, she was charged and convicted in the High Court of extorting almost $250,000 from the man and sentenced to 12 months' home detention.

As the 52-year-old was the victim in the 2010 case, and informed the court he wished to keep the affair from his family, he was granted final name suppression.

Judge Crosbie said the pair were not granted name suppression in relation to the recent offending, but the man cannot be named because of his existing suppression.

Crown solicitor Robin Bates indicated after the hearing he intended to fight to have that suppression quashed.

Judith Ablett Kerr, QC, sought interim name suppression for the mistress so an appeal against naming her client could be filed.

Judge Crosbie granted the woman interim suppression until 4pm today.

Despite serving home detention for her previous offending, the blackmail resumed in July 2011.

To fund the blackmail, the authorised financial adviser completed 122 false insurance policy application forms and collected more than $300,000 in commission from seven insurance companies. He paid his former mistress $187,036 to keep the affair from his family.

After he deposited the money into his mistress' bank account, he cancelled the insurance policies.

Judge Crosbie also ordered the man pay reparations of $150,000 to his wife.