3 Feb 2011

Former real estate agent jailed for fraud

12:05 pm on 3 February 2011

An Auckland real estate agent involved in a scam that prompted reforms of the real estate industry has been sentenced to four and a half years in prison.

Raghu Aryasomayajula was involved in a series of mortgage frauds in which he used third parties to gain loans from banks, costing the banks $3.8 million.

In his sentencing at the Auckland District Court, Judge Roy Wade said he had read three victim's impact statements which they said they were effectively "sucked in" by allowing their names to be used to secure loans.

He says as a result all three were made bankrupt and lost their employment because they too were engaged in real estate.

Judge Wade said that Aryasomayajula has suffered depression, but so too have his victims, who have been through just as much if not more than him.

A co-defendant, Philip Cavanagh, was sentenced to two years five months in jail after pleading guilty to the same fraud charges.

The 2007 scam, which saw four Barfoot and Thompson sales agents and an assistant sacked, led to the Government's major overhaul of the industry, including significantly higher penalties for rogue agents.