A wealthy United States businessman implicated in an $800,000 scam involving a Remuera finance company director has denied wrongdoing and threatened to sue New Zealand Police for dragging his name through the mud.
In an extraordinary interview from Canada, Robert Vashisth told the Herald he was a legitimate member of the financial business community with several companies and dozens of staff.
Claims by an Auckland judge that his actions were “highly suspect” following a high-profile criminal trial were shocking and defamatory, Vashisth said.
He maintained that police never contacted him ahead of the trial about his alleged involvement, nor was he called as a witness to give evidence.
“I believe the police did a s**t job. Why didn’t they contact me?
“The police should be protecting people and doing their job right. But I became a victim because of a police investigation. Now I’m labelled. That’s not fair.”
Vashisth became a key figure in last month’s money laundering trial for Auckland businessman Michael Sperry, who was ultimately acquitted.
The court heard that Sperry used his ANZ bank account to receive an $800,000 payment from a New Zealand scam victim who believed he was investing in Citibank.
Sperry claimed he had a “custodian agreement” with Vashisth’s offshore crypto exchange, MiloX, to onboard funds from New Zealand-based investors.
Sperry would then receive instructions from Vashisth to send the money overseas, earning thousands of dollars in commission.
The former commercial real estate agent only met Vashisth on a video call and mainly communicated with him via the encrypted Signal app.
Sperry denied receiving stolen money, claiming the victim had “orchestrated” the payment to purchase Bitcoin and then made a false allegation about being defrauded after getting cold feet.
Judge Paul Murray was sceptical about Sperry’s claims, saying he did not accept outright some of the evidence given in court, which was “murky and leaves me uneasy”.
There was “no real dispute” the victim had been caught in a scam, the judge said.
It remained unclear how Sperry’s ANZ account details found their way onto a Citibank-branded payment form sent to the victim by scammers.
However, Judge Murray said he could not exclude Sperry’s explanation that he thought he was engaged in a legitimate business transaction, “despite some suspicious features”.
“Mr Vashisth‘s role in this whole affair is highly suspect. However, Mr Sperry’s complicity in that is not established beyond reasonable doubt.”
Vashisth told the Herald he grew up in India before moving his family to the US where he had been involved in several successful patents and worked for the military.
Asked how much he was worth, he declined to answer, saying, “I don’t trust you”.
Vashisth confirmed he owned the MiloX exchange and had been looking to expand into New Zealand and Australia.
Asked why he needed Sperry, he said: “When you are in the crypto or banking world, you have lots of different partners because you can’t be everywhere in the world. Michael was one of those.”
Vashisth said he had never been involved in criminal activity but regularly encountered scams in his line of work.
In the Auckland case, his company froze the $800,000 payment after the depositor repeatedly failed to provide “know your client” (KYC) identification details requested as part of the verification process.
As a result, the money sat untouched in Sperry’s holding account for 13 days.
“The shocking part is we were the one who initiated a pause and stopped this transaction.
“This guy failed [KYC checks] three or four times. We didn’t move any funds. We didn’t push anything. We never received a single dime.”
Vashisth said if he was a scammer, the money - most of which was eventually recovered by the bank - would have been transferred out of Sperry’s account immediately and whisked abroad.
He also said it was unlikely he’d agree to be interviewed by a major newspaper if he was part of a criminal organisation preying on unsuspecting investors.
“Why would I be a scammer? We have a successful business. I have nothing to hide.”
He blamed incompetent police work for the situation he was now in and was consulting lawyers about suing New Zealand authorities for damage to his reputation.
“They can’t even investigate properly and just blame somebody. Why didn’t they call me? They haven’t done their job.”
Asked about the judge’s “highly suspect” comment, Vashisth said Judge Murray had relied on the information presented in court.
“Whoever gave the information to the judge never talked to me.”
Vashisth wasn’t convinced the Auckland victim had lost money to scammers and was unsure how Sperry’s account details wound up on a Citibank payment form.
“That’s a good question. I am puzzled also because we have nothing to do with Citibank.”
Responding to Vashisth’s criticisms, Auckland City Financial Crime Unit boss, Detective Senior Sergeant Craig Bolton, said the Sperry investigation was one of many involving suspected “money mule” schemes.
He said an organised crime ring was believed to be perpetrating a scam, deceiving victims into believing they were dealing with Citibank officials.
The alleged scheme involved money laundering across international jurisdictions.
Police targeted offenders who resided in New Zealand who were believed to have helped launder the proceeds of crime.
Bolton said mules often mistakenly believed they were operating a legitimate business.
Police investigating the case did not consider it essential to interview Sperry’s alleged associates as they were all based offshore.
“Based on our inquiries and our understanding of this scam type, we consider that Mr Vashisth is likely another money mule caught up in the elaborate scheme.”
The Auckland victim told the Herald Sperry’s claim that he’d made up a fraud allegation to recoup an $800,000 Bitcoin investment was “ludicrous” and “complete fiction”.
He was surprised at Sperry’s acquittal, in light of the suspicious circumstances canvassed at the trial, and believed Sperry had himself been scammed.
“It just shows that smoke and mirrors pays dividends.
“Unfortunately he can carry on his merry way.”
The construction firm owner, who has name suppression, says he was duped by a man posing as a Citibank portfolio manager into sending his life savings to Sperry’s account.
He thought he was investing in a low-risk term deposit and never intended to purchase risky cryptocurrency.
The man made the huge money transfer in person at his local ASB bank branch in April 2023.
“I took the documentation into the bank and asked the teller to verify it was going to Citibank. He went out the back and said, ‘It seems all right - I’ve googled it’.
“I thought they probably know what they were doing, which was silly in hindsight.”
The man claimed ASB staff didn’t question him about whether the investment could be a scam or what due diligence he had carried out into the recipient account.
He was disappointed that ASB allowed an $800,000 payment to be sent to a private ANZ account when it was marked as a Citibank investment. He felt this was a missed “red flag” by the bank.
“They’re not really concerned about protecting people. They’re concerned about protecting their own arses.”
ASB said it was not the bank’s process for staff to confirm the legitimacy of a receiving account.
The staff member had instead sought assistance on making a same-day payment while completing ID checks to confirm the identity of the person making the transfer.
ASB said the victim appreciated the efforts made to recover the majority of his funds and had expressed hope that “systems could be improved to make it harder for scammers”.
ASB had invested heavily in fighting scams and promoting awareness, but said customer vigilance was critical to prevent fraud.
Lane Nichols is Auckland desk editor for the New Zealand Herald with more than 20 years’ experience in the industry.
Sign up to The Daily H, a free newsletter curated by our editors and delivered straight to your inbox every weekday.