Federated Farmers is concerned to the point it has notified the Serious Fraud Office (SFO), Land Information New Zealand (Linz) and the Ministry of Foreign Affairs and Trade (Mfat) of the issue.
And the involvement of a bankrupt Australian "life coach", is a strange new twist to the matter.
The Invercargill real estate agent brokering the sales, John Wright, yesterday confirmed Shane Wenzel, a white Australian who has upset Maori in the past by styling himself as a Maori guru, had travelled to Southland in September.
But he said part of what had been "a very interesting exercise" was checks and balances of the process, one of which was to make sure Wenzel was not involved.
"As far as we know, he's been removed from the scene."
Wenzel was yesterday reported as saying he was not actively involved in the farm deal.
Wenzelis involved in a $4.7 million mortgage fraud trial. The verdict is expected on Wednesday.
Wenzel also hit the headlines in July when, acting as a Maori elder, he led a protest group that disrupted a High Court trial to draw attention to injustices against Maori.
Federated Farmers rural security spokesman David Rose said the organisation "as a matter of course" spoke to Mfat and Linz about such issues.
"All we did, as a matter of course, was notify the SFO, Mfat and Linz," Mr Rose said.
Contacting the SFO was "just a matter of signalling to them this thing was happening", he said.
Federated Farmers raised its concerns last week about the deals, and Mr Rose said yesterday it was warning "extreme caution" in dealing with the group.
The Otago Daily Times reported last week there were concerns in the rural industry about the group's actions, from delays confirming sales contracts to deposits not being paid as expected.
Dubai World was rumoured to be backing the group, but corporate communications senior vice-president Sarah Lockie said on Friday the company was not involved in the dairy farm purchases "in any way".
Southern Wide Real Estate director Dallas Lucas said last night although the company initially provided listings for the group, the 1% deposit offered raised concerns, as 10% was more common.
Mr Rose said he was aware of people who had "moved on", after initially showing interest in the offers.
Asked if the plan was still going ahead, Mr Wright said, "Well, it's going through the process, which is the point we've made all the way through."
Under normal circumstances he said he would advise people to "walk away from it", but there were some aspects of the group that seemed to stack up well.
Nobody was locked into any contract, and people could withdraw at any time.
Wynn Murray, the Invercargill spokesman for the group, did not return a phone call last night.
