William Yan's record-breaking deal with police is the second time the wealthy businessman has forfeited a small fortune to authorities.
He has agreed to pay $42.85 million in a "full and final" settlement with the police following an investigation into alleged money laundering, without any "admission of criminal or civil liability".
The asset forfeiture order was signed off by a High Court judge and means a lengthy trial, estimated to take six months, is no longer necessary.
But it's not the first time Yan has forfeited millions of dollars.
In 2005, the Australian Federal Police seized two bank accounts in the name of Desant Group Ltd, registered in the tax haven of the British Virgin Islands, holding A$6.75m.
The accounts were frozen because he was suspected of operating bank accounts in a false name, Yang Liu - the name in which he was later granted New Zealand citizenship.
The matter was settled when Yan consented to the money being forfeited without any admission of liability.
Nearly half the money, A$3.3m, was repatriated to the Chinese government with the balance was returned to Yan.
According to court documents obtained by the Herald, Yan said the settlement was motivated by "practical considerations".
"Legal costs would have been substantial and any hearing would have been extended and taken likely between two to three years to resolve," Yan wrote in an affidavit for the New Zealand forfeiture proceedings.
"My immigration status in New Zealand at that stage was being progressed and I did not want the Australian proceedings to compromise that. Immigration NZ was considering revoking my permanent residency and my citizenship application had been put on hold.
"These were compelling reasons for me to settle the Australian proceedings. The short point however is that there was no admission of liability at all by me as is the case in most civil settlements that occur."
He was later controversially granted a New Zealand passport in 2008 despite having multiple identities and an Interpol alert against his name.
Former Labour Minister Shane Jones over-ruled the advice of officials from the Department of Internal Affairs, who said Yan did not meet the good character test for citizenship.
Yan - who entered New Zealand with two passports in the names of Yong Ming Yan and Yang Liu - had the support of several MPs in his bid for citizenship, most notably Dover Samuels.
Yan was later acquitted on five charges relating to false declarations on immigration and citizenship papers despite Justice Timothy Brewer saying the evidence "proves a situation that is highly suspicious".
The Auditor-General later investigated how Yan came to be granted citizenship, and criticised Jones, but found no evidence of wrongdoing. The politician said he believed Yan would be executed if sent back to China.
Yan has said he made his fortune legitimately as a businessman and the two identities he came to New Zealand with, Yong Ming Yan and Yang Liu - are valid because he was fostered out by his birth parents in China.
Both sets of parents registered him as part of their household with different names and dates of birth, said Yan, and the Chinese Government considers him an enemy because he is associated with Falun Gong and is pro-democracy.
It remains to be seen if China will seek the extradition of Yan, who is ranked fifth on the list of China's most wanted fugitives.
Justice Minister Amy Adams said there had been no formal extradition request from China.
"I understand that officials from China have made contact informally with my officials and expressed some interest.
"They are requesting information and wanting more information from us about what would be required."