29 Sep 2018

Two Auckland businessmen jailed for fraud

9:43 am on 29 September 2018

Two Auckland businessmen have been jailed for fraudulently obtaining a $41 million loan to build an inner-city apartment block.

Entrance to the High Court in Auckland

Entrance to the High Court in Auckland Photo: justice.govt.nz

Property developer Leonard Ross and company director Michael Wehipeihana lied to ANZ Bank to get the loan for their company, Emily Projects Limited.

They also forged sale and purchase agreements to support the loan application to construct the Waldorf Celestion Apartment Hotel, which consists of two towers with 127 apartments, on Anzac Avenue in Auckland's CBD.

In July a jury found the pair guilty of three charges of obtaining by deception and two representative charges of using forged documents after an eight week trial.

They were both sentenced to more than four years' imprisonment at the Auckland High Court on Friday.

Serious Fraud Office director Julie Read said the sentence outcomes reflected the seriousness of the offending.

"The SFO is committed to investigating and prosecuting this kind of offending to maintain the integrity of the mortgage market for the benefit of honest borrowers."

Two other men involved in the fraudulent scheme were sentenced to 10 months' home detention.

Vaughn Stephen Foster, a self-employed consultant, pleaded guilty to one representative charge of obtaining by deception just before the trial commenced and was sentenced in June.

Timothy Upton Slack, a lawyer, pleaded guilty to one representative charge of obtaining by deception in September last year and was sentenced later that month.