More than $17 million of alleged bribes in a South American corruption scandal were shifted from the Bahamas into a New Zealand bank account earlier this year. Photo / File
More than $17 million of alleged bribes in a South American corruption scandal were shifted from the Bahamas into a New Zealand bank account earlier this year. Photo / File
A corrupt lawyer living in Spain took $24m in bribes to arrange lucrative contracts with Venezuela's state-owned oil company. He pleaded guilty to corruption and money laundering, with millions of dollars being laundered through Swiss bank accounts. Now New Zealand police allege his wife sent $17m of dirty money to a Hamilton accounting firm.
More than $17 million of alleged bribes in a South American corruption scandal were shifted from the Bahamas into a New Zealand bank account earlier this year.
The small fortune was frozen by the High Court after a New Zealand police investigation into alleged money laundering by the wife ofa Venezuelan government official working for the state-owned oil company.
Luis Carlos de Leon Perez, 43, was arrested in his holiday home in Spain in October 2017 and extradited to the United States to face serious corruption charges laid by the US Justice Department.
Perez was a lawyer for Petroleos de Venezuela S.A, the state-controlled oil company, and along with four others were referred to as the "management team" who allegedly received $180m in bribes.
US investigators believe they have not identified the full extent of the bribe payments, because of a complex network of trusts, bank accounts and investments use to launder the money.
Perez admitted taking millions of dollars in bribes and kickbacks from contractors to win business deals with the oil company, or ensure they paid ahead of other contractors when Venezuela's financial crisis threatened to put PDVSA into liquidation.
According to the US Justice Department, more than $24m of bribes were paid into a Swiss bank account controlled by Perez. These funds were then funnelled into other bank accounts in Switzerland, as well as companies, real estate and other investments.
In July 2018, Perez pleaded guilty to one count of conspiracy to violate the Foreign Corrupt Practices Act, and one count of conspiracy to commit money laundering. He is yet to be sentenced.
But in March this year, detectives from the Asset Recovery Unit in the Waikato were alerted to a wire transfer of $17.5m from the Bahamas into an accounting firm in Hamilton.
The money was being held in trust for Andreina Gamez Rodriguez, the wife of Perez who was living with him in Spain at the time of his arrest.
The assets have been restrained under the Criminal Proceeds Recovery Act; a civil case where a High Court judge can grant the freezing order if there are "reasonable grounds" to believe someone has profited from "significant criminal activity".
In this case, the police allege Gamez Rodriguez has committed money laundering by bringing $17.5m into New Zealand which is likely to be the criminal profits of her husband's corruption.
Gamez Rodriguez, now living in the United States with her husband who is on bail, has not been criminally charged with money laundering.
But cases taken under the Criminal Proceeds Recovery Act are determined by the civil level of proof, the "balance of probabilities", rather than the much higher criminal evidential threshold of "beyond reasonable doubt".
In a recent hearing in the High Court at Hamilton, she claimed the funds were legitimate and she was estranged from her husband, in a bid to overturn the restraint order.
This month, Justice Simon Moore released his decision which rejected Rodriguez's arguments and ruled the $17.5m will remain frozen in the custody of the Official Assignee for now.
Whether the seized assets are ultimately forfeited to the Crown will be determined at a later hearing in the High Court, either by way of a trial or a potential settlement agreement.
Detective Senior Sergeant Keith Kay, the head of the Asset Recovery Unit in the Waikato, said the civil case against Rodriguez shows the the police will take action against the proceeds of foreign bribery and corruption when such funds are allegedly found in New Zealand.
"This outcome also demonstrates the importance of New Zealand Police working collaboratively and in partnership with foreign law enforcement colleagues, and also the abilities of our investigators to respond to alleged international money laundering."
The case is the latest example of police testing their powers under the Criminal Proceeds Recovery Act, which came into force in 2009.
In the past, the law has most often been used to seize wealth accumulated by drug dealers but the police have pushed into new territory in recent years.
There have also been several high-profile cases involving allegations of wrongdoing in other countries, working closely with international law enforcement agencies.
In November, the Herald revealed the curious case of nearly $6.7m in cryptocurrency seized from a computer programmer who made millions of dollars from an alleged pirated movie website.
Millionaire businessman William Yan was sentenced to five months' home detention for money laundering. Photo / Brett Phibbs
The most high-profile case was when William Yan agreed to pay $43m - without admitting civil or criminal liability - which is easily the largest settlement in the history of the legislation in New Zealand.
As part of the deal, Yan agreed to return to China to plead guilty to embezzlement and on his return to New Zealand, admitted money laundering.
In a similar case, nearly $70m in New Zealand bank accounts have been frozen as part of a global investigation into a wealthy Chinese businessman accused of running a massive pyramid scheme from Canada.
Xiao Hua Gong built a business empire in Toronto including a hotel chain and television channels, as well as attending fundraisers for Canada's Prime Minister Justin Trudeau and donating to the governing Liberal Party.
He was arrested in Canada and charged with fraud and money laundering in connection with the alleged pyramid scheme involving "the fraudulent sale of hundreds of millions of dollars" in shares in China.
Gong says the evidence against him was gathered by coercion in China.
Xiao Hua Gong, far left, at a fundraiser for Justin Trudeau. Photo / Supplied
