The justice system likes to say that crime doesn't pay, but courts have over the past decade tagged more than a billion dollars worth of luxury cars, properties, cryptocurrency and cash as its proceeds. Matt Nippert pores through asset seizures and court filings to break down New Zealand's richest criminal enterprises.
Criminal empires are notoriously difficult to survey. Subject to the observers' paradox, once it is known fortunes are illicit, proceeds invariably melt away through laundering, law enforcement seizures, or both.
Many white-collar crimes involve massive sums - rich-list investors lost $80m in the Penrich Capital fraud prosecuted last year - but by the time they are discovered, ponzi schemes have invariably run dry with the bulk of proceeds already recycled and paid out to earlier investors. Kelly Tonkin, architect of the Penrich ponzi, claimed before sentencing he was broke and unable to even afford a lawyer.
One, admittedly imperfect, window into the world of criminal fortunes is the Criminal Proceeds (Recovery) Act.
This legislation enables police to seek restraining orders on property alleged to be criminal proceeds, before a hearing to determine whether the assets should be forfeited.
Unlike criminal prosecution, actions under this Act are civil and require not a determination beyond reasonable doubt but only on the balance of probabilities.
Over the past 10 years police have restrained more than $1b in assets alleged to be the proceeds of crime, with annual sums rising sharply over the course of the decade and increasingly dominated by a handful of international whales whose use of New Zealand is more as laundering territory than feeding ground.
Three individuals subject to these orders, out of a total of 815 restraint orders issued since 2012, make up more than a quarter of all funds seized over the past decade.
Assets ultimately forfeited are sold and paid into a contestable fund accessible by government agencies for specific projects. This year Cabinet approved the fund, flush with record seizures, to dish out tens of million to the likes of Youthline and the Christchurch City Mission.
The practical scope of the Act has been widened considerably since its passing in 2009. In recent years it has been used to assist transnational investigations into corruption and money-laundering and police have tried to extend it to cover workplace safety breaches.
1. Alex Vinnik, $140m restrained
A very modern criminal, Russian national Alex Vinnik, 43, is described by his own lawyers as a "computer genius" and by international prosecutors as the central figure in a cryptocurrency-enabled laundering, ransomware and heist network that stole hundreds of millions of dollars in bitcoin and moved billions around the globe.
Vinnik was arrested in Greece in 2017 largely over the operation of his BTC-e trading platform that the United States Department of Justice claims turned an intentionally blind eye to criminal networks - cyber criminals, ransomware scams, identity theft schemes, corrupt public officials, tax fraudsters and drug rings - using its service to launder billions.
Vinnik was also claimed to have been involved in the infamous Mt Gox bitcoin heist, and to have created Locky ransomware and shared its extortion earnings of €135m ($221m).
Vinnik's operations were global, and found to have reached New Zealand. A number of web domains for the bitcoin exchange were registered locally, and New Zealand registered companies were found to control $140m. These funds have now been restrained by New Zealand police, with the results of overseas court actions likely to determine whether this fortune will be forfeited.
While Vinnik is now nearing the end of his French prison term, his future - and any prospects of freedom or regaining control over his fortune - looks anything but rosy.
A diplomatic and policing tussle is under way between Greece, Russia and the United States over who should get to extradite him next to face more criminal charges. And while he got only a five-year prison term in France, the US money-laundering and extortion indictment carries a maximum sentence of 55 years.
2. Edward Gong $69.5m forfeited
Politically connected Chinese-Canadian businessman Edward Gong ran a hotel chain and television channels in Toronto, but law enforcement agencies claimed his real trade was running pyramid schemes.
In 2017 he was arrested in Canada - where he was a political donor to the Liberal Party and had attended fundraisers for Prime Minister Justin Trudeau - and charged with fraud over allegations his medicine-selling scheme had defrauded $202m from victims in China.
The New Zealand angle was laundering, with police here alleging profits from the scheme - more than $77m over seven years - were routed through this country from China through bank accounts and property deals. In 2016 ANZ Bank here became concerned enough to place a stop on Gong's accounts and flag the activity as suspicious with New Zealand police.
Bank accounts holding $69.5m were restrained in New Zealand in 2017 - before criminal charges were even laid in Canada - and this sum was ultimately forfeited last year after Gong elected not to contest claims by police that the mountain of cash was, on the balance of probabilities, derived from criminal offending.
The Ontario Securities Commission convicted Gong's Edward Group last year on forgery and pyramid-selling offences, and has in train an order banning the businessman from conducting business in the state.
Local fallout from the case saw further probes into how Gong managed to move so much money through New Zealand and for so long. These led to Auckland mother and son Fuqin Che and Quing Fu being convicted of money-laundering and fined a total of $3m after their Jiaxin Finance firm was found to have "intentionally concealed" more than $50m in transactions made by Gong.
3. Bill Liu $43m forfeited
While the first two names in this ranking are truly transnational and largely used New Zealand as a laundering vector, Bill Liu was an - albeit controversial - local citizen.
Liu, also known as William Yan, fled to New Zealand from China in the first decade of the 2000s. He applied for residency, then citizenship, with his application complicated by fraud complaints from his homeland that included having his name placed on Interpol's "Red List" that would get him arrested if he were to fly internationally.
Police began probing the fraud complaints in 2007, finding Liu had gambled $293m at SkyCity casino over more than a decade.
Liu managed to skirt Internal Affairs officials who put a hold on his citizenship application, citing the fraud complaints in China, by appealing directly to Minister Shane Jones for an exemption. An investigation by the Auditor-General criticised Jones, but found no evidence of political corruption.
By 2014 Liu was a New Zealand citizen - a highly effective shield for those wanting to avoid extradition to China - but the walls were closing in. Police in New Zealand restrained more than $40m in cash, luxury vehicles and real estate, while Chinese officials declared him the country's "fifth most wanted man".
After years of backroom court and diplomatic proceedings, in 2017 a grand deal was struck: Liu gave up the $43m in return for pleading guilty to money-laundering charges that would come with no more than a sentence of home detention.
A similar arrangement was made with authorities in China whereby Liu would return in handcuffs and plead guilty, but also avoid a custodial sentence.
He is today believed to be living free in Hong Kong.
4. Jaron McIvor $21.7m forfeited
Arguably New Zealand's most infamous internet file-sharer not called Kim Dotcom, Jaron McIvor drew the attention of United States authorities after they began looking into his movie-streaming website and concluded it was powered by copyright breaches.
A probe of the site's financial flows found proceeds were being routed through Canada and Vietnam before ending up in New Zealand with McIvor.
While copyright offences are not considered a criminal matter in New Zealand, the fact they are in the United States meant dealing with these profits met the bar for money-laundering. Restraint orders, covering $1.1m and a multi-million dollar pile of cryptocurrencies, were served.
McIvor was charged with neither money-laundering nor piracy, but in November 2020 cut a deal with police whereby he forfeited the cryptocurrency and all but $400,000 of the cash.
His placing on this list is largely thanks to the, until recently, booming crypto market. When the asset restraint was originally put in place in November 2019 the haul of cryptocurrency was worth $6.7m.
A year later, when McIvor agreed in a court settlement he "acknowledged profiting from downloading and selling movies protected by copyright" and forfeited everything seized except for $400,000, that stash was said to be worth north of $21m.
5. Andreina Rodriguez $17.5m restrained
Adreina Rodriguez first came to the attention of New Zealand authorities in March 2019 when US$11.85m ($17.5m) was transferred from the Bahamas into a BNZ account managed by a Hamilton-based financial firm. The bank queried the funds, and was told the sum came from Rodriguez's architecture work from a decade ago.
She also told the BNZ, through the Hamilton financial firm, that while her husband faced an "issue" in the United States, they had separated and she was not under investigation herself.
It turned out this "issue" faced by her husband, Louis De'Leon, involved being arrested and extradited and later pleading guilty in US courts to corruptly abusing his position as lawyer for a Venezuelan state-owned oil company to receive more than $25m in bribes.
Actions taken by United States authorities since had included freezing $27m in Swiss accounts held in his wife's name.
Police followed up the report from BNZ and found that far from being separated, the couple were together when De'Leon was initially arrested in their Spanish holiday home and continued living together while he was on bail in Texas.
Rodriguez appealed the restraint, and in rejecting it a High Court judge summarised her response to date after being told police considered her explanation for how she came into possession of $17.5m was unsatisfactory.
"Having been confronted with evidence contradicting her misrepresentation, she now offers no plausible explanation, or any explanation at all, as to its origin," Justice Simon Moore said in late 2019.
6. John Bracken $11m restrained
For most people, GST is something you pay. But Gisborne farmer John Bracken, 56, thought he had figured out a way to achieve the opposite. Over a four-year period Bracken filed paperwork purporting to be running an exporting business, claiming $133m of sales entitled him to $17.3m in GST refunds.
Inland Revenue and police disagreed, starting a years-long investigation and prosecution. He was ultimately convicted last year. In 2021 he was given an eight-year prison sentence for what the judge described as the largest crime ever seen of its kind.
Parallel to the criminal prosecution came asset restraint procedures, with a haul including a $7m farm, a holiday home in Opotiki, as well as tractors, quad bikes, a digger, several utes and a 6.5m fishing boat seized.
Representing himself, Bracken this year tried to appeal his conviction and sentence. According to the ruling, he advanced Sovereign Citizen claims - that government agencies were legal fictions and as he had not explicitly consented to the tax laws in question they therefore did not apply to him - but these novel arguments were roundly rejected.
7. Wayne Doyle $10m restrained
Police allege Wayne Doyle is the national president of notorious motorcycle gang the Head Hunters. Although a number of senior members of the gang have been jailed in recent years, Doyle has avoided criminal sanction for more than 20 years.
Police claim Doyle's status in the gang, and its policy of members pooling 20 per cent of their criminal earnings, helped him accrue a $10m property portfolio. These real estate investments were acquired despite Doyle declaring no income to Inland Revenue for many years, police say.
Courts restrained the properties in question in 2017, but a trial to determine whether the assets are proceeds of crime on the balance of probabilities has twice been postponed, with a judge-alone hearing now scheduled for October.
8. Stephen Gray $5.1m forfeited
Hamilton auto-trader Stephen Gray was convicted in 2012 of manufacturing and supplying methamphetamine with the judge in his case saying he was "a drug supplier on a major scale and deserving of severe punishment".
The court heard his farm near Raglan had a number of camouflage bunkers where drug manufacturing took place. Alongside a prison sentence of 12 years, the courts ordered him to forfeit $2.4m in bank accounts said to be proceeds from the drug trade, and another $2.7m in cars and properties.
9. Yu Ping Gong $4.9m forfeited
Investigations into Edward Gong also prompted authorities to have a look at his Auckland-based brother, Yu Ping Gong.
While the Auckland Gong, recorded as being a plumber, was not suggested to be involved in his brothers' fraud, eyebrows were raised when it was found he had built an eight-property real estate empire in New Zealand while simultaneously claiming a taxable income of just $429 over the most recent five years.
In a deal cut in 2018, Gong agreed to forfeit properties worth $4.9m - keeping two worth $3m - and while denying any tax evasion agreed to also pay Inland Revenue $1.2m.
-Additional reporting by Jared Savage
