An immigration adviser and finance broker have admitted defrauding a wealthy overseas investor of millions of dollars in an Auckland real estate ruse.
Jian Long and Wen Ting Zhang appeared this morning in the High Court at Auckland where they pleaded guilty to what Justice Mathew Downs described as “five species of fraud”.
Both admitted charges of theft by a person in a special relationship, obtaining by deception, using a forged document, false accounting, and dishonestly using a document.
Their victims were a wealthy investor and his wife who had applied to move to New Zealand under the Government’s investor immigration category. As part of the approval process to obtain permanent residence they decided to consider various real estate investment projects.
Ultimately, they were conned into paying about $6m.
Long, a 37-year-old licensed immigration adviser, and Zhang, a 38-year-old broker, were both remanded on bail until their sentencing next month. They had been due to stand trial in less than two weeks.
Court papers obtained by the Herald show the immigration consultant looking after the investor’s application in New Zealand was Long.
It was proposed to wealthy man that he would join an investment syndicate to purchase land for about $22m. But it was a ruse to secure several payments utilising corporate structures, including a company established with Long as a director – Wow Development Limited – and legal advisers from 2015 to 2017.
The investment property was on Clark Rd, Scott Point, Hobsonville and was part of a series of lots which form part of the residential development known as Hobson Green.
The investor was told he needed to invest sums of money to enable the purchase of a proposed project property, while Long and Zhang conveyed the false impression they were also contributing towards the investment. In fact, they misrepresented the amounts and contributed nothing.
Their offending included the use of a $10m loan agreement with forged signatures and numerous emails containing false invoices to help obtain the investor’s funds, court documents show.
Bogus invoices purported to be from Auckland law firms Duthie Whyte and Amicus Law, geotechnical and environmental consultancy company Soil & Rock, and property valuation firm Simon Head & Associates.
Fake invoices were also used from Harrison Grierson – one of the country’s leading engineering and design consultancies – along with a bio research and construction company.
The invoices included claims payment was required to deal with asbestos and a “final bill for dealing with contaminated soil”.
The duo also used a forged Land Information New Zealand (LINZ) title document. LINZ is the government department which conducts geographical information and surveying functions, handles land titles, and manages Crown land and property.
In a victim impact statement written last year, the investor said he became suspicious about the business arrangement and had his accountant examine the accounts, leading to the discovery of a multimillion-dollar shortfall.
As a result, he said he and his wife came to New Zealand earlier than intended to deal with mess and engage lawyers to investigate and try and recover the loss.
They also were forced to sell the land to repay the fraudulent loans taken out against the property.
A third offender in the scheme has already pleaded guilty to three charges of obtaining by deception and was sentenced to eight months’ home detention by Justice Simon Moore last year.
Peng Pian, who came to New Zealand in 2003 from China before gaining permanent residency in 2009 and starting his own construction business, said he became entangled in the deal because he thought it made “good business sense”.
As part of the wider fraud, Pian’s offending involved a false representation that a $4.4m deposit was required for the property development. He also lied to the investor by explaining an “under the table payment” of $2m was required for him to pay his boss.
After realising the extent of the fraud, Pian told pre-sentence report writer he’d made a “big mistake” after becoming “greedy”.
Pian received $630,000 from wealthy investor as a result of the deception.
However, the overseas investor, the court heard at sentencing, has forgiven Pian after being repaid the amount, including $30,000 for lost interest.
The 38-year-old’s repayments came before the involvement of the police or courts.
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