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A property schemer who devised a system to fool people into believing they owned their own homes has been slammed in the Auckland District Court.
Christopher Mark Ashenden, director of companies The Home Finance Company and Meguro, was found guilty of breaching the Fair Trading Act and ordered to pay $237,048 in fines and court costs and $42,764 in reparation – even though he went bankrupt in October 2010.
The Commerce Commission took action against Mr Ashenden after he promoted property schemes that lured vulnerable consumers into believing they were buying properties, although they were never registered on the titles.
Investor companies bought residential properties, mostly in South Auckland, using a property investment model Mr Ashenden promoted.
He used phrases such as “Why rent when you can buy?” and “Rent is dead money” to market the scheme.
Instead of owning the property outright, people who signed up to the scheme were granted rights to occupy under a 30-year instalment agreement with the various companies.
The companies had bought the properties and were registered on the titles as the owners with mortgages registered against them.
The occupiers made weekly payments of principal, interest, rates, taxes and insurance to the owners and had to fund any repairs.
However, Mr Ashenden did not make it clear to the occupiers that they would not have legal ownership of the property until the 30-year period had expired.
Judge LH Moore said Mr Ashenden had lured people into commitments that were “a recipe for disasters in which they lost everything they had put into the property they were seeking to acquire – indeed were given to understand they had acquired.”
Judge Moore said Mr Ashenden’s offending had contained strong elements of cynicism and the “calculated exploitation” of people.
He said Mr Ashenden’s bankruptcy was nothing more than a ploy and not an indication of his true worth.
“The court has no hesitation in concluding that Mr Ashenden is one of those people whose affairs are deliberately kept complicated to the point where it is exceedingly time consuming and expensive to unravel them.”
Civil action against Home Finance Company, Mr Ashenden and other companies involved in the scheme continues.