The Australian Securities & Investments Commission, Asic, claimed that while employed as a home finance manager by Westpac, David St Pierre had induced his victims to borrow against their homes to invest in a the real estate project.
One woman, a 98-year-old living in an aged care facility, was signed up to a 30-year loan.
Asic alleged that between July 2008 and June 2010, St Pierre had dishonestly used his position to submit the loan applications for approval when he knew they contained false information and false documents. St Pierre then received cash bonuses of up to A$15,000 for organising the loans.
The money ultimately went to a company called All About Property Development (AAPD), which was part of an associated company called Capital Growth International Club (CGIC).
The customers received monthly interest payments from CGIC and AAPD after they invested, however the payments stopped shortly before a liquidator was appointed on 28 February 2011. This left customers without sufficient income with which to repay their loans to Westpac.
A district court in Queensland found St Pierre guilty of the offences and sentenced him to three years imprisonment, but allowed him to be released after just six months after paying a A$1,000 bond.
In delivering the sentence, judge Kent said that St Pierre's behaviour was described accurately in his opinion by the Crown as calculated, elaborate, determined and not a fleeting mistake.
ASIC commissioner Peter Kell said: "St Pierre's actions betrayed the trust of his clients and caused them significant financial harm. This sentence showed such behaviour will not be tolerated."
Westpac has compensated the customers involved.