May Wang loses IRD fight as bankruptcy looms

May Wang leaves Auckland High Court during a break in her bankruptcy hearing last month. Photo / Greg Bowker

Failed property developer May Wang's attempt to avoid bankruptcy in the Auckland High Court has been rejected.

Wang has been fighting Inland Revenue's attempt to bankrupt her over a $1.3 million debt it says it is owed after the collapse of her property development company the Dynasty Group.

The case is set to return to the High Court tomorrow.

Wang owes several creditors millions from the collapse of the Dynasty Group. Most of these creditors have voted in favour of a proposal to pay them 6.5c in the dollar.

That deal was subject to High Court approval.

Associate Judge Hannah Sargisson said the "application to approve the proposal is refused" after a four-day hearing in court last month.

The IRD believes allowing Wang to continue normal business activity would put the public at risk.

IRD lawyer Nick Malarao said Wang had not disclosed all her assets to her creditors, including four companies in the British Virgin Islands, offshore trusts and offshore bank accounts.

Wang is also the frontwoman of Natural Dairy, the Chinese-backed company that is trying to buy several large North Island dairy farms, formerly owned by the Crafar family.

Graham Chin, vice chairman of Natural Dairy said the company would be making a statement about how the decision might affect is plans to purchase the farms "after getting more facts on the high court and cosulting our legal advisers".

Wang said during the hearing if she was bankrupted Natural Dairy's plan to buy the farms would collapse and her creditors would receive nothing.

The court said Wang had not been forthright to either her creditors or the court, the decision said.

"The disclosure of her interest in the UBNZ Trust has been entirely inadequate."

"Ms Wang's financial affairs are, it is readily appreciated, complex. They involved companies registered in New Zealand overseas, property-owning trusts and a web of transactions between the various entities."

"These factors point to the worth of an investigation into Ms Wang's financial affairs by the Official Assignee."