Phone recording between Auckland businessman Carel Vijoen and a Westpac bank employee discussing suspicious transactions in and out of his account.
Three banks are implicated in a large-scale international fraud which cost two Kiwi victims $1M each.
One bank increased the mule’s transfer limit to $1m so he could move the stolen cash, at the same time concerned staff filed a suspicious activity report due to “red flags”.
In an interview with the Herald, the businessman claims he checked with Westpac that it was okay to proceed with the financial scheme.
A scam victim tells senior reporter Lane Nichols he is humiliated over losing his children’s inheritance and “I’ve failed as a husband to protect my wife”.
A man who laundered $2 million in stolen funds told Westpac bank he had “no idea” where the money was going and admitted it was strange his paymasters needed a “middle person” to move huge cash payments overseas.
“I don’t understand ... how it works, but I make some moneyout of it, so I said ‘yes’,” Auckland businessman Carel Johannes Viljoen told Westpac in a recorded phone conversation that was pivotal evidence in his trial this week.
Beca costings expert Carel Johannes Viljoen, 61, was found guilty in Auckland District Court of two counts of money laundering in connection with two victims who lost a combined $2 million to an elaborate investment scam. Photo / Alyse Wright
A judge granted the Herald access to a trove of court documents, including audio files of Viljoen’s comments captured in the Westpac recordings.
In an interview with police, Viljoen said he was introduced to the scammers by his brother and never met his Canadian bosses - only communicating with them via the encrypted social media channel WhatsApp.
He set the Westpac bank account up under his own name on January 6, 2023. Five days later he signed an online contract with the fraudsters stating he was acting as a “trustee under the laws of New Zealand”.
Days later, his account received payments of $1m and $950,000 from two scam victims. The money was immediately sent offshore.
Viljoen was paid around 3% commission for moving the stolen cash through his account, but maintains he did not know it was a scam.
The victims - both retired and one of whom is now dead - were duped by a fake Magnitude Financial investment fraud involving overseas criminals posing as financial advisers.
They thought they were purchasing government-backed bonds though the Commonwealth Bank of Australia. In fact their money went to an account controlled by Viljoen - a 61-year-old Beca costings expert who by day is involved in large infrastructure projects worth hundreds of millions of dollars.
The Herald has confirmed that the Financial Markets Authority (FMA) posted a public scam warning about the Magnitude Financial scheme two days before the second victim Anthony Lipanovic - a grandfather and keen trout fisherman from Rotorua - wired $950,000 in person at his local ASB branch.
ASB refused to answer questions about why the scam wasn’t detected given the FMA’s warning and whether the bank is confident it acted with proper due diligence and care.
“It is not appropriate for us to comment on this matter. We have enduring confidentiality obligations to all customers. The matter is also before the court.”
Viljoen was charged with two counts of money laundering in 2023 and granted interim name suppression on the grounds that identification would cause extreme hardship and cast suspicion on his employer.
But he can finally be named after being found guilty on both charges after a trial this week in Auckland District Court. Viljoen faces up to seven years behind bars.
‘I don’t know why they need the middle person’
After being alerted to the fraud in February 2023, police executed a search warrant at Viljoen’s home. He told investigators he became concerned when the huge payments landed in his account.
In a series of recorded conversations obtained by police through court production orders, he tried to explain his unusual side hustle to Westpac staff.
Steven Fan victim of a $1 million investment scam from Northland. Photo / Supplied
Asked about the nature of the financial arrangement and his knowledge of the Australian account he was sending money to, he replied: “That’s a good question. I really have no idea. They are distributing the money wherever it needs to go”.
Pushed further by Westpac, Viljoen said “I don’t understand ... how it works.
“But I make some money out of it, so I said yes”.
He then admitted: “I don’t know why they need the middle person, that’s apparently how they work. But I agree it’s not conventional at all”.
Viljoen later told police it was “unusual, and contrary to his business experience, for financial arrangements of this scale to be conducted via WhatsApp”.
‘I don’t want to get involved in money laundering’
In an exclusive interview with the Herald ahead of his trial, Viljoen said he visited Westpac’s Queen St branch to discuss the financial scheme with bank staff before receiving the first payment.
He took a copy of the WhatsApp Paymasters Services contract and claims he asked staff for guidance about whether he should proceed.
“[I said], ‘Money will come in and this is the contract I have’. I gave it to them and said, ‘I don’t want to get involved in money laundering. Can you please look into this and tell me if I can go ahead’?”
Viljoen claims that after checking the contract, staff gave him the all clear to proceed.
He had a $30,000 transfer limit on his account. This meant he had to get the bank’s clearance every time he received instructions to make a large offshore transfer.
“I had to go to the bank ... I went in person several times. I’d say, ‘Here’s the next amount, this is where it’s going, can you give me clearance?’
“They gave me special clearance every time.”
Carel Johannes Viljoen, 61, claimed he sought assurance from Westpac Bank that the financial scheme was above board before transferring nearly $2m in stolen money overseas. Photo / Alyse Wright
He initially understood he’d be receiving small payments (up to $100) from Jewish people living abroad who wanted to send money home to Israel through the church. However, they didn’t want to be identified, hence the need for a middleman.
He says he told this to Westpac and now feels he was let down by the bank.
Viljoen also blames his brother for getting him involved, who he claims is now working to repay the victims’ lost money.
“He got me in the shit and he has to pay that back.
“The only reason I got into it was because I trusted my brother. I would never do such a stupid thing.
“I have never been in trouble with the law in my life. I’ve never even had a police speeding ticket.”
‘It’s his money, he can do whatever he wants'
Westpac’s actions were the subject of considerable scrutiny during the trial.
The court heard Viljoen met bank staff to explain the financial scheme and ask for his transfer limit to be raised to $1m.
The Westpac employee told the court the circumstances raised “red flags” because it involved a substantial increase and international payments, so she checked with her supervisor.
“I got told, ‘It’s his money. We have no control over it. He can do whatever her wants'.”
She then increased the limit as requested, and told Viljoen “it’s okay” to proceed with the payment.
But despite giving Viljoen clearance, she also filed an internal suspicious activity report (SAR) due to her concerns.
Westpac's actions were the focus of scrutiny at Carel Johannes Viljoen's money laundering trial this week. Photo / 123RF
The defence claimed Viljoen was uncertain about the scheme and looking for an assurance from Westpac, which he received.
“He’s told basically, ‘It’s fine, go for it',” defence lawyer Matthew Goodwin said in his closing address.
“They have effectively given him the green light.”
Goodwin said it was contradictory for Westpac to approve a limit increase so Viljoen could move $1m offshore, despite holding sufficient concerns to file a SAR report about the transaction to the bank’s anti-money laundering team.
The staff member was asked what happened to her SAR report. She told the court, “I have no idea”.
Goodwin said it was telling the Westpac’s fraud team only learned of the scam from another bank, rather than from internal sources. He suggested the SAR report was a missed opportunity to prevent the victims' money being lost.
Crown prosecutor Taniela-Afu Veikune also singled out Westpac.
“Could they have done more? Absolutely. You might think that a system that flags a transaction as suspicious as that transaction flies past is probably a little silly.”
But what banks did or didn’t do was a “red herring”, he said.
The jury’s sole focus had to be whether Viljoan ought to have known the money was the proceeds of a crime and if he was reckless when sending it offshore.
The Herald asked Westpac about its actions and whether it had acted with proper care and skill.
“We acknowledge that there were aspects of this case that we would now handle differently,” a spokesman said.
He said the bank had invested heavily in the last two years in new processes and training to help staff identify suspicious activity and take action to protect customers.
It had also upgraded fraud monitoring systems and rolled out mule account information sharing with other banks.
“We believe our focus on financial crime prevention is bringing positive results, with customer losses to fraud and scams falling over the last two years.”
‘I’ve failed as a husband to protect my wife’
The two victims were hoodwinked after searching online for investment opportunities to safeguard their financial futures.
Lipanovic wired $950,019.99 to Viljoen on January 26, 2023. Viljoen was then instructed to transfer those funds to the Commonwealth Bank of Australia.
Within days he’d sent more than A$800,000 ($887,500) to the specified account plus another $28,000 to his brother. He kept the remaining $31,000 as commission.
Before his death from cancer in December 2023, Lipanovic told police ASB’s fraud department contacted him in February that year advising him he’d been caught in a scam.
About $600,000 of his money was recovered.
The other victim is retired Northland man Steven Fan. He says the scammers were skilled con men. He is deeply ashamed and humiliated at being duped.
He told the Herald he and his wife had worked “to the bone” over many years to build an English language school in Taiwan, working as English teachers. The investment proceeds were meant to be their adopted children’s inheritance.
“This was my life savings. We wanted to give them something nice.”
Fan’s wife has a serious health condition. He had planned for interest from the investment to pay for her eventual nursing home care.
Losing the money had life-changing consequences for his family. He says he’s lost his wife’s trust.
“I’ve failed as a husband to protect my wife. I failed her.”
‘They just took my word’
Herald investigations show Fan’s bank, TSB, helped him send his life savings to the thieves.
It’s also emerged he made two separate $1m transfers. The first was in late December 2022 to the Commonwealth Bank of Australia.
A TSB employee helped arrange an outward telegraphic transfer by phone. But Fan later realised the supposed bond investment was not jointly registered in his wife’s name as planned.
He contacted the scammers and - in a curious twist - they told him to ask TSB to cancel the transfer so the “bonds” could be re-registered.
TSB Bank's Bell Block Branch
When the cancellation was confirmed two weeks later, the scammers sent Fan new payment instructions for Viljoen’s Westpac account.
On January 13, 2023, TSB staff again helped Fan complete a $1m payment.
Asked what questions TSB asked, Fan replied: “What it’s for and have you done due diligence, and I said, ‘Yes’.
“They didn’t check. They just took my word.
“They tried to be polite. Unfortunately, in hindsight, they were too polite. In future they should be more forceful when questioning clients like me.”
Fan did not make a formal complaint and had no knowledge of the Banking Ombudsman’s Scheme before being contacted by the Herald.
For a long time Fan felt he was to blame. But he now believes the banking sector should shoulder more responsibility for protecting customers and preventing fraud.
After the $1m payment landed in his account, Viljoen received instructions to transfer the money to a company deregistered by the Australian Securities and Investments Commission the previous year.
Four days later he sent US$324,000 ($563,760) to an Australian account and another US$266,000 ($462,840) the following day. He sent about $29,000 to his brother overseas and kept the remaining $31,500 as commission.
About $80,000 was later recovered.
TSB inquiries showed no ‘hallmarks’ of a scam
Court documents show police sent TSB a production order request for details of the bank’s fraud investigation in March 2023 but never received a response.
TSB told the Herald it had “a number of discussions” with Fan about the payment instructions while it assisted with the transfer.
“Mr Fan was asked to confirm more than once what the payment was for, and a consistent response was given. We made further inquiries ourselves internally which included reviewing the payment invoice.
“During the course of these inquiries we did not identify any obvious indicators to suggest fraud.”
Fan had clearly been caught in a sophisticated fraud, “reinforced by the fact that our internal inquiries did not identify any obvious scam hallmarks”.
TSB confirmed it did receive a police information request in March 2023, but this was “missed”.
The bank said it now wanted to help Fan make a complaint with TSB, which included possible escalation to the Banking Ombudsman.
Meanwhile, police have contacted Interpol about the scam but are awaiting updates from Queensland Police.
Viljoen will be sentenced in June.
Lane Nichols is Deputy Head of News and a senior journalist for the New Zealand Herald with more than 20 years' experience in the industry.
