It took a jury over a day of deliberations to return guilty verdicts on most charges in the case of the Auckland “money lady” who laundered millions for a Kiwi drug syndicate boss. Herald reporter George Block covered the trial charting the rise and fall of Ye (Cathay) Hua.
Two weeks into 2021 Ye Hua, proprietor of Lidong Foreign Exchange in Newmarket, had a dream she was at the centre of a massive natural disaster.
Hua kept a dream diary in her native Mandarin. She was a deeply religious person who spoke of having the protection of God in relation to her work as a money remitter.
Her youngest daughter, called as a character witness during her trial, said her mother strongly believed what the vivid dreams told her.
That vision in January 2021 would prove prescient.
Two months later police raided Lidong’s office in Newmarket’s Kent St and the multi-million dollar St Heliers mansion the money-remitting business helped purchase.
Her happy and prosperous suburban life, partly funded by the profits of a ruthless drug cartel, came crashing down.
Police arrested Hua and charged her with 19 counts of money laundering covering almost $30 million of transactions.
Most of the charges covered about $27m allegedly sent overseas into foreign currency or converted into bitcoin at the behest of modern-day Mr Asia Xavier Valent, jailed for life earlier this year for his role as the kingpin of a massive drug syndicate.
The remainder of the charges covered transactions with two low-level drug dealers and a former key lieutenant of Valent. He became the star witness for the Crown who gave crucial evidence that helped seal her fate.
That witness, convicted for his role in the syndicate but granted name suppression immunity from further prosecution for money laundering in exchange for giving evidence, estimated that during his time with the syndicate in Auckland they made about $25m. When business was booming they could make $1m per week.
He said the cash could become wet or sticky - one of the key red flags in the Crown case - because it was being handled by people who were manufacturing or using meth.
Valent was a micromanager during the period he was travelling the globe on the run from late 2016 to his eventual arrest at the Italian border in 2020 on an Interpol warrant.
He would tell her when to expect one of his associates to arrive at Lidong’s office in Newmarket, dubbed the “money shop” or “Newmarket money lady” in messages obtained by police.
Asked what was meant by the money shop, the witness was unequivocal.
“That’s Cathay’s money shop. No 1 Kent St, Newmarket.”
All charges against Hua alleged she either knew the cash was the proceeds of crime, or was at least reckless as to whether it was ill-gotten gains.
Crown prosecutor Sam McMullan said she repeatedly ignored red flags, including the fact the money was sometimes wet or covered in powder and arrived in supermarket bags delivered by suspicious characters.
Her lawyer David Jones KC said Hua was a deeply religious and trusting woman who was taken advantage of by a ruthless international criminal mastermind.
He called a cast of character witnesses that included four Christian ministers and two of her daughters who described her generous but sometimes naive nature.
One of them was a Timaru man fluent in Mandarin who spent years as a missionary in China and was described as currently a “freelance Christian” by Jones. He said there were elements of naivety and gullibility to Hua’s character and she could be easily led on.
The man also revealed that while she has been on bail, her business shuttered, Cathay and her husband Joshua have been running an online Christian ministry group. She had expressed a desire to enter into the ministry fulltime and eventually become a missionary, he said.
Messages between Hua and Valent were obtained as part of Operation Ida, the money laundering inquiry into her activities, run by Detective Sergeant Anna Henson and featuring covert listening devices installed in Lidong and digital wiretaps on cellphones.
Those messages, sent via encrypted applications favoured by Valent and his minions, show Hua repeatedly expressing her concern the cash was drug money.
“Let your contact know, don’t bring drug money to me,” one message said.
Valent ran his syndicate from overseas after he fled the country in 2016 as Customs closed in on his drug-importing operation.
The drug runners he employed on the ground in New Zealand repeatedly dropped off money that was dirty, sometimes sticky or covered in white powder, and needed to be literally washed before it was figuratively laundered.
The prosecution said Hua, who gained a degree in microbiology from a pharmaceutical university in China in the 1980s, should have been alive to the risk it was drug money, especially given the fact Valent’s minions were at times clearly drug addled when they made their drops at Lidong.
But the trial heard no evidence Hua was actually brought into the syndicate as an operative.
This was not Auckland’s version of the American television series Ozark, where an expert accountant is a willing and sophisticated money launderer with expert knowledge of international finance and fully aware he is washing cash for a Mexican cartel
Instead, the evidence suggested she turned a blind eye over several years to obvious clues she should not have been helping Valent and the others send the cash overseas.
The Crown suggested she was willing to turn a blind eye due to her need for masses of hard cash. That was because Lidong operated an informal money-remitting system, dubbed “Hawala” by officials after the Arabic term for transfer or wire.
The system operates outside official banking channels and requires remitters to hold large bundles of cash to keep their operations going, especially after New Zealand banks stopped allowing money remitters to hold accounts.
On Wednesday, after more than three weeks of evidence, the prosecution and defence gave their closing addresses.
McMullan said she was not just a trusting person who blindly believed whatever someone told her.
He cited messages between Hua and Valent where she rejected his explanations as to the odd behaviour of a meth-addled drug runner (that she was sick) or why money had become sticky (that it had been near sellotape rather than handled by meth cooks).
“She didn’t really care where the money was coming from,” McMullan said.
In his closing, Jones once more implored the jury to see matters from the perspective of his client, whom he described as unique due to her cultural and religious background, generosity and idiosyncratic worldview.
“She’s probably more unique than most people,” he said.
Jones made much of the fact Hua did not cover her tracks before police swooped. She kept hold of all the spreadsheets showing Valent’s millions heading overseas, and did not delete her messages with the drug lord.
“If she knew, why on earth would she keep the spreadsheets? Jones said.
“Why would she keep all of the messaging?”
The jury retired to deliberate on Wednesday afternoon, mulled the verdicts all through Thursday and Friday morning then announced they had reached a verdict a shade after noon.
The first two verdicts came back as not guilty.
These covered the two earliest transactions in 2017 when she first started sending money overseas for Valent and suggested the jury gave Hua the benefit of the doubt that early on, she may not have cottoned on to the warning signs.
But on the remaining 16 charges, the jury returned 15 unanimous guilty verdicts. One of the 19 charges was dropped during the trial.
Many of the charges were representative, meaning they covered multiple transactions. One charge alone covered more than $11m across 57 deposits for Valent.
The remaining not guilty verdict was of a money laundering charge that covered an alleged $50,000 transaction. Hua held back tears and appeared to be praying under her breath as she stood in the dock while the foreman read the verdicts.
Judge Sharp remanded her on bail on existing terms ahead of her sentencing on November 16 at 10am.
The money laundering charges Hua was found guilty of carry a maximum possible term of seven years imprisonment.
Read the Herald’s full coverage of Ye Hua’s trial:
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