1MBD scandal: Judge allows Malaysian businessman tussling for $370m in seized assets to take control of NZ trusts
A judge has allowed a controversial Malaysian businessman and his family to take control of New Zealand trusts as they seek to fight the seizure of assets worth $370 million.
In December, relatives of a Malaysian businessman with ties to Hollywood and accused of money laundering, said they would launch a bid in a New Zealand court to protect his assets from being seized by the United States.
The assets of Low Taek Jho - known as Jho Low - were being seized as part of an investigation into the scandal-tainted 1MBD fund, which the US Department of Justice alleged more than $US3.5 billion (NZ$4.9b) was misappropriated from.
The lawsuits sought to seize $1.4b in assets allegedly diverted from the state-owned development fund into luxury real estate in New York, Beverly Hills and London, valuable paintings, and a private jet.
The relative's bid to protect assets held by some trusts was set to be heard before Justice Kit Toogood in the Auckland High Court Friday, with court documents released ahead of the hearing revealing more detail about the case.
They said about US$265 million (NZ$368m) in assets, ranging from a private jet to American mansions, was at stake in a dispute over the control of trusts.
The submissions for the relatives sought to replace the current trustee of New Zealand trusts, Swiss-based Rothschild, with a New Zealand-based entity of Cayman Islands law firm FPP.
Low's relatives want to replace the trustee because Rothschild had not taken steps to oppose the forfeiture orders sought by the US.
The relatives have brought a number of other proceedings against the US forfeiture orders, the submissions said, but Rothschild's inaction meant orders against some trusts were at an advanced stage.
"In the event the forfeiture proceedings are not contested, the plaintiffs will lose their entitlement to trust assets worth approximately US$265m (NZ$368m)," the submissions said.
Submissions for the defendants said they were not opposed to being replaced as trustees but considered it must be done by a court order because of the action brought by the US.
The trustee also wanted to be covered for any costs incurred by transferring the assets.
It specified the assets being sought were a Bombardier Jet, a luxury hotel in Beverly Hills, and three other properties, while noted the trusts owned other assets in Hong Kong, Singapore and the United Kingdom which were not being sought at this stage.
Low's relatives were named as Low Hock Peng, Goh Gaik Ewe, Low May Lin, and Low Taek Szen.
After a delay to Friday's hearing, Justice Toogood said he was satisfied he should make the orders sought.
But as there was continued discussion between the parties about certain ancillary orders, he adjourned the hearing to 2:15pm, when he expected to read his judgment.
The judge said there was no need for him to express any view as to the merits of the US case against Low.
Late Friday, Justice Toogood's judgment was released, in which the orders sought were approved.
"I am satisfied that assets located in the United States, valued in excess of US$250m, are likely to be forfeited to the US Government... unless parties properly authorised to do so, who have a sufficient interest in the assets, take the procedural steps available to them at law to oppose the making of the orders."