Mortgage scam estate agent sent to jail for four years

Former real estate agent Raghu Aryasomayajula. Photo / Michael Craig

The former real estate agent found guilty of a $13.5m mortgage scam has been sentenced to four and a half years in prison.

Raghu Aryasomayajula, 38, was sentenced at the Auckland District Court this morning. He was found guilty of two counts of obtaining by deception by Judge Roy Wade at a judge-alone trail in November.

Judge Wade gave a sentence starting point of five years, but took six months off because of what he called "financial pressures" from family members overseas.

He declined to give Aryasomayajula any discount for his lack of previous convictions, because it was repeat offending.

Aryasomayajula and a co-defendant Phillip Julian Cavanagh, both former Barfoot and Thompson agents, were convicted of charges that involved deceiving banks into lending money on 10 residential properties.

In the $13 million real estate scam, Cavanagh and Aryasomayajula bought properties which could be subdivided.

To get money for the developments, Aryasomayajula filled out mortgage applications in the names of work colleagues and acquaintances.

To gain bank approval, the applications often contained false employment records, inflated wages and left out existing debt.

Cavanagh pleaded guilty in October 2009 to three charges and was jailed for two years and five months. His sentence was reduced after he agreed to give evidence against Aryasomayajula.

In his decision last year, Judge Wade said he was satisfied Aryasomayajula knew banks were being given grossly erroneous information, "much of it deriving directly from him", and that this false information was a major inducement to the ANZ Bank to grant the mortgage sought.

Barfoot and Thompson managing director Peter Thompson said last year that verdict sent a clear message to the real estate industry - "You do the crime, you do the time."