Wanted Chinese businessman found living in NZ to return to Australia over alleged $19m tax fraud

The Australian Government wants to prosecute Li Zhang over alleged tax offences. Photo / Sam Hurley

A Chinese businessman, who was living undetected in New Zealand, has surrendered himself and will return voluntarily to Australia to face charges relating to an alleged multimillion-dollar tax fraud.

Li Zhang, 56, appeared today in the Auckland District Court where Judge Nevin Dawson and everyone else in the room expected him to fight the Australian Government's attempts to extradite and prosecute him.

But Zhang, who has been in held in a Kiwi prison since his arrest on April 4 this year, soon began raising his hand and interrupting the proceeding.

Crown prosecutor Fiona Culliney said it appeared Zhang was now willing to voluntarily return to Australia.

"Yes sir," Zhang told Judge Dawson.

"Exactly," he continued to proclaim.

He then briefly consulted with his lawyer Quentin Duff.

"Sir, I've got written instructions that he's ready to be sent back to Australia," Duff told the judge.

Zhang was then led away back into the cells, but before doing so he turned to a tearful family member in the public gallery and with a big smile gave two thumbs up.

The alleged fraud he is accused of is linked to a luxury New South Wales golf course and resort in which the Australian Government claims it was defrauded of $10.5 million.

The total loss to the Australian Government is alleged to be more than $19m.

Zhang was arrested by the New Zealand Police when officers attended a minor car crash in April before an Australian warrant for his arrest was endorsed by Judge Ajit Singh.

The Chinese-born Australian citizen had left New South Wales in 2009 when police and tax officials were looking for him under a search warrant.

He disappeared from authorities for a decade.

It later became apparent that Zhang had been living at a high-end rental property north of Auckland.

It is not clear how long he was living in New Zealand.

According to the Australian Taxation Office, Zhang owned the Chinese construction company Hightrade. More than 100 of its subsidiary companies collapsed 10 years ago.

The company's finance head, Simon Chan, also left Australia and has not returned.

The ATO was looking at Hightrade for the way it behaved during the construction of the Pokolbin golf course and its resort in the Hunter Valley.

The Australian Government alleged the construction group inflated the cost of building the resort by more than $115m.

Hightrade executive Song (Peter) Chang was charged with tax fraud.

Chang was jailed in 2017 for five and a half years for conspiracy to defraud the Australian Government.