The Government's bid to recover $3.2 million from benefit fraudster Wayne Patterson has been rejected by the Austrian courts.
The Crown is continuing to fight the 53-year-old fraudster, who has received legal aid in Austria to argue that he is entitled to the money.
He was caught after a Social Development Ministry investigation in 2006 revealed that he had faked 123 identities to steal $3.4m.
He was sentenced to eight years and nine months in jail and is due to be freed from Whanganui Prison in July 2015.
The Crown has recovered $3.5m from Patterson but is also seeking assets deposited in Austria, including Apple shares that have almost quadrupled in value and are now worth more than $3m.
The shares and cash are in an Anglo-Irish Bank account in the name of Westgate Holding, a company registered to the Seychelles. The Crown understands Patterson has signing authority over the account.
The Crown asked the Austrian Public Prosecutors Office to seek forfeiture of the funds, but information obtained under the Official Information Act reveals that the Vienna Regional Court rejected the bid for forfeiture in March 2009.
The prosecutors appealed, and in 2010 the regional court ruled that the assets were to be forfeited to the Austrian Government.
Patterson then appealed, and has now had the forfeiture overturned on the basis that the Crown has already recovered more than the amount he stole. Austrian taxpayers funded his appeal, despite the Crown's opposition.
It is not uncommon for recovered assets to exceed the amounts stolen, as interest payments, inflation and share-price movements increase their value.
Patterson's Apple shares, for example, were bought before the advent of the iPhone and the iPad. Their value has gone from $810,000 in 2007 to more than $3m. Yesterday, the company's share value hit a record high of US$665.15.
Patterson was declined parole last month, with the Parole Board labelling him an arrogant, egocentric man who saw "the life of a big-league parasitic fraudster as more rewarding than the drudgery of ordinary honest toil".
It said he was likely to continue as a fraudster if paroled, and he felt entitled to the assets in Austria because he saw them as the product of his investment skills.
Social Development Ministry head of fraud Iona Holsted said: "Patterson's failure to do the right thing by New Zealanders and return the money means we were forced into legal proceedings to retrieve the money.
"Wayne Patterson had plenty of time to do the right thing that would have avoided this court action. His actions to date show just how manipulative and selfish he is.
"This money belongs to New Zealanders, the very same people Patterson so callously ripped off."
Guy Sayers, of the Insolvency and Trustee Service, which is acting as the Crown's agent, said the Crown was "looking to its options in both criminal and civil jurisdictions in Austria for recovery of the assets", which have been frozen by the Austrian courts.
Patterson was declared bankrupt in December by order of the High Court in Whanganui over $3.1m in unpaid taxes to Inland Revenue. Bankrupts cannot leave the country without written permission from the Official Assignee.
- The Dominion Post