IRD investigates Auckland property-flipping group St Johns

Inland Revenue is investigating dozens of Auckland property transactions involving the St Johns group that may have affected as many as 120 vulnerable immigrant families, BusinessDesk reported, including Filipino first-home buyers who say they were introduced via a community Facebook page.

As many as 120 vulnerable immigrant families may have been affected by the house-flipping activities of Auckland property group St Johns, and the Inland Revenue Department is investigating dozens of the group's transactions, BusinessDesk reported.

IRD investigators have met families who say they were left thousands of dollars out of pocket, asking them to fill out questionnaires about their dealings with St Johns. Several Filipino buyers said officials held two meetings last month — one on Auckland's North Shore with about half a dozen families, and another in Manurewa — and brought a large box of files on more than 120 families. One wife who attended said Filipino, Pasifika and other families were among those affected.

Filipino first-home buyers and a Papakura price jump

In July, BusinessDesk reported that Filipino families said they were introduced to St Johns by fellow Filipino Aurfel Balmelero, who runs the Pinoy First Home Buyers Facebook page offering help onto the property ladder. St Johns, through its lawyer, categorically denied targeting the Filipino community or any other ethnic or religious group. Balmelero also denied targeting the community and referred questions to St Johns.

Jimmie Feced and his wife Maricon told BusinessDesk they bought a three-bedroom weatherboard home on Valentine Street in Papakura through St Johns after responding to the first-home buyers Facebook page. They said they were shown the house by the Filipino agent, St Johns director and shareholder Stuart Jackson, and another St Johns employee, and signed an already-completed sale and purchase agreement on the spot without having met the lawyer listed as representing them.

Property records cited by BusinessDesk show the Valentine Street home sold for $617,000 on 8 December 2023, again three days later for $642,000, then to the Feceds in February 2024 for $795,000 — $178,000 more than the December price. The couple paid a $60,000 deposit, and Feced said St Johns offered to pay off their personal debts, leaving them owing the group $70,000 on top of their mortgage. He said he only learned of the price jump after a friend bought a similar home for much less.

Tax debt, liquidation bid and the company's reply

The High Court heard that Catalyst 2 Consultancy, described as a St Johns entity at the centre of many of the house flips, owed $2.2 million in unpaid tax, including $2.1 million in GST. IRD has applied to liquidate the company. Associate Judge Liz Gellert granted a final adjournment to 10 December after the company's lawyer said it had a new director and shareholder. Stuart Jackson was the sole director and ultimate owner until 10 September, six weeks after IRD applied for liquidation.

In a statement, the St Johns group said it was not involved in property trading and was not aware of any IRD inquiries, and that Catalyst 2 Consultancy — renamed C2 Consultancy — had been sold and was not associated with St Johns. On Valentine Street, it said Ridgeview sold the home to C2 on a GST zero-rated basis for $740,000 and C2 sold it for $795,000 on an independent Valocity valuation; after settlement the company spent close to $20,000 on remedial works and a driveway upgrade, assisted the buyers with a $60,000 interest-free loan for two years, and paid a $5,000 cashback.

Other investigations

The Real Estate Authority said last week it was actively progressing regulatory investigations relating to Jackson, including into reports received. Financial Services Complaints Limited said it was investigating complaints about St Johns' financing arm, St Johns Property Holdings, and had issued a preliminary decision in one case. NZ Herald earlier reported that Jackson was found guilty of unlicensed trading in the Auckland District Court and fined $2,500 plus costs after falsely signing a sale and purchase agreement as a licensed agent while director of Catalyst 2 Properties Limited. IRD said the law prevented it from commenting on any taxpayer's private tax affairs.

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