Beneficiary loses luxury wheels

Paul Yu Szeto. Photo / Greg Bowker

A sickness beneficiary with a taxpayer-subsidised state house was instead living in an upmarket Auckland suburb and driving luxury cars worth $250,000.

Paul Yu Szeto, also known as Yu Hong Ho, is facing money laundering and methamphetamine charges and is due to appear in the High Court at Auckland this month.

The police allege the 57-year-old Chinese national was writing out cheques for cash from drug dealers. A trial date will be set at the next hearing.

Szeto has pleaded not guilty to the charges and declined to comment as the case was before the courts.

However, the police have also seized three valuable vehicles from Szeto, including a Porsche Cayenne and two late-model Mercedes Benz, worth a combined total of $250,000.

A sickness beneficiary for nearly a decade, Szeto was living at a Housing New Zealand property in the North Shore suburb of Belmont. When drug detectives searched the state house last July, they found it unoccupied.

Neighbours said they remembered seeing the Porsche and Mercedes Benz come and go from the state house, but hadn't seen any movement for months.

Instead of staying at the taxpayer-funded home, Szeto was living in a rental home in upmarket Mission Bay.

Neighbours of that address also recall the valuable cars parked in the driveway - described by one as "beauties" - before they were seized by police.

The pair of Mercedes Benz are registered to Szeto's girlfriend, Wei Na Shi, who is also facing money laundering charges. The Porsche Cayenne is registered to a company of which Wei Na Shi is the sole director and shareholder.

A spokeswoman for the Ministry of Social Development was unable to offer an explanation as to why a sickness beneficiary was living in a state house while driving luxury cars.

Justine Auton, general manager of MSD integrity services, said she was unable to talk about the case because of the charges.

Crown prosecutor David Johnstone confirmed restraining orders had been made in the High Court to freeze the sale of the three cars. The assets are in the possession of the Official Assignee until the court case is over.

Szeto has been charged in connection with the police's Operation Blanko, involving Northland businessman Max John Beckham.

The 61-year-old Beckham is to stand trial on methamphetamine charges after police allegedly found 141g of P - with a street value of up to $140,000 - and a loaded gun in raids on properties in Auckland and Northland.

The Crown has frozen more than $2.5 million of property, a fishing boat and $865,000 cash from the property developer, as well as two late-model Ford Falcons.

The property was seized before recent amendments were made to the Criminal Proceeds (Recovery) Act.

The new law came into force in December and allows police to confiscate unexplained wealth from suspected criminals without having to prove any offence has been committed.

Previously, the police had to prove to the high standard of "beyond reasonable doubt" that assets were criminal proceeds, even after defendants were convicted.

Police now have to prove only to the much lower civil threshold of "on the balance of probabilities" - essentially placing the onus on the criminals to prove where they got the assets.

THE CHARGES
* Money laundering on or about October 1, 2007.
* Money laundering between October 31 and November 15, 2007.
* Money laundering on or about September 29, 2008.
* Conspiring to manufacture methamphetamine between May 16 and August 11, 2006.
* Supplying methamphetamine between August 13, 2006, and December 23, 2008.

THE CARS
* 2005 Mercedes-Benz SLK 350 convertible.
* 2003 Mercedes-Benz saloon.
* 2005 Porsche Cayenne.