Trial begins for property dealer accused of $14m fraud

8 March 2007

An Australian property dealer appeared in court yesterday on charges that he defrauded $18 million from the Australian St George Bank with a property scam.

Henry Kaye's arrest followed an investigation by the Australian Securities and Investment Commission (ASIC) which found evidence that he had fraudulently used property bonds to secure an $14 million loan from St George.

Mr Kaye is alleged to have used the loan to purchase 168 apartments in St Kilda in the suburbs of Melbourne and to have then sold them for profit to low-income clients at a series of "wealth creation" seminars that he ran.

St George also claim that the clients that Mr Kaye secured were unable to pay and had not been subject to any means checks before being issued with property bonds for the then-unfinished buildings.

This week St George, which is Australia's fifth-biggest bank, issued a statement to reiterate that it expects to record ten per cent earnings per share growth over the next two years.

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