NZ court tussle over assets said to be linked to 1MDB

Relatives of Malaysian businessman Low Taek Jho (above, right) want to block the US seizure of assets owned by a number of New Zealand trusts, including a Bombardier private jet (above).
Relatives of Malaysian businessman Low Taek Jho want to block the US seizure of assets owned by a number of New Zealand trusts, including a Bombardier private jet (above).PHOTOS: NYTIMES, THE STAR/ASIA NEWS NETWORK
Relatives of Malaysian businessman Low Taek Jho (above, right) want to block the US seizure of assets owned by a number of New Zealand trusts, including a Bombardier private jet (above).
Relatives of Malaysian businessman Low Taek Jho (above) want to block the US seizure of assets owned by a number of New Zealand trusts, including a Bombardier private jet.PHOTOS: NYTIMES, THE STAR/ASIA NEWS NETWORK
The New Zealand trusts named in the case also own New York real estate, such as a penthouse in the Time Warner Centre (above).
The New Zealand trusts named in the case also own New York real estate, such as a penthouse in the Time Warner Centre (above).PHOTO: BLOOMBERG

AUCKLAND • An Auckland courtroom will hear tomorrow a case involving NZ$230 million (S$235 million) worth of assets allegedly linked to Malaysian state fund 1MDB, including penthouses in Manhattan and a private jet, the New Zealand (NZ) Herald newspaper reported yesterday.

The case involves the family of Malaysian businessman Low Taek Jho who, through several New Zealand trusts, wants to block the United States' Department of Justice (DOJ) from seizing those assets, the report said.

The US court filings claimed that Mr Low's relatives are beneficiaries of a number of these New Zealand trusts that own the assets believed to be linked to funds from 1Malaysia Development Berhad (1MDB).

The move to bring the case to a New Zealand court came to light after a US federal judge in Los Angeles last month rejected a move by Mr Low's family members to claim the assets seized by the US government in the 1MDB probe.

Mr Low, widely known as Jho Low, was an adviser to 1MDB when it was set up by Malaysian Prime Minister Najib Razak in 2009.

Swiss investigators have said that some US$4 billion (S$5.7 billion) of 1MDB funds may have been misappropriated.

The DOJ said last July that some of the funds had been used to buy penthouses and luxury houses in the US and London, a jet as well as expensive artwork, and to finance the movie The Wolf Of Wall Street, among other things.

The DOJ said it is trying to recover some US$1 billion of these assets through civil lawsuits, by seizing them from three people, including Mr Low and Datuk Seri Najib's stepson Riza Aziz. The third person named is a former government official from the United Arab Emirates.

Datuk Seri Najib has repeatedly denied accusations of wrongdoing in the 1MDB affair. Mr Riza and his movie company Red Granite have denied using 1MDB funds to make the movie. Mr Low has denied any involvement with 1MDB except during the fund's early days.

Meanwhile, Malaysia's International Trade Minister Mustapa Mohamed said in Davos, Switzerland, that the nation must "move on" from the 1MDB scandal, Agence France-Presse reported.

In the New Zealand case, the NZ Herald said, Mr Low's relatives, through their lawyers, wished to ask the New Zealand High Court to appoint someone who would be willing stop the DOJ from seizing the assets.

The High Court in Auckland confirmed a defended hearing involving the parties was set down for tomorrow morning.

The US filings said some current trustees were concerned that failing to oppose their replacement raised the possibility that they might fall foul of US laws criminalising money-laundering, it said.

The filings claimed a number of New Zealand trusts - with names as varied as Elephant Sun and Stars Tower - were the direct owners of assets. The assets included a Bombardier private jet, a hotel in Beverly Hills and a US$55 million Los Angeles mansion.

New York real estate owned by the New Zealand trusts included two Manhattan apartments, including a US$43 million penthouse in the Time Warner Centre formerly owned by celebrity couple Beyonce and Jay-Z, the NZ Herald said.

The newspaper checked the records of the Companies Office and found that the New Zealand trusts were set up by Auckland law firm Cone Marshall, which said it had no direct contact with the beneficiaries.

Cone Marshall said the firm provides local director and office services for Rothschild Group and Rothschild Trust New Zealand. Rothschild declined to comment.

A version of this article appeared in the print edition of The Straits Times on January 19, 2017, with the headline 'NZ court tussle over assets said to be linked to 1MDB'. Print Edition | Subscribe