Penalties totalling $1.4 million were imposed after Yat Ming Lau was sentenced to seven years imprisonment for illegally importing pseudoephedrine. Profit forfeiture extended to assets held in the name of girlfriend Shuo Chang.
Ms Chang unsuccessfully defended Criminal Proceeds (Recovery) Act claims. She said assets in her name were funded with her own money plus loans from her parents in China. Under the Act, police did not have to prove she participated in illegal drug importations, only that she knowingly benefitted.
The High Court was told that over a seven year period to May 2014 a total of $1.3 million in unexplained funds passed through bank accounts controlled by Ms Chang and Mr Lau. During this period, Mr Lau’s declared annual taxable income was $44,900, Ms Chang’s $38,300. A forensic audit identified substantial amounts spent on jewellery and other luxury items. This spending stopped shortly after Mr Lau’s arrest.
There was evidence of funds being used to service loans on an Auckland property in Richard Farrell Avenue, Remuera, owned by a Lau family trust. A second Lau property at Rukutai Street in the Auckland suburb of Orakei was sold to Ms Chang, with funding provided by Mr Lau, police said. A BMW car registered to Ms Chang was similarly funded by Mr Lau, police said.
Ms Chang knew Mr Lau was repeatedly importing pseudoephedrine and she helped conceal his interests in property, Justice Downs said. She knowingly benefitted from Mr Lau’s illegal activities. The two had been ‘good friends’ since 2002. On one power utility account she was described as Mr Lau’s ‘wife.’ Spending on expensive jewellery and extended trips to China ended abruptly after Mr Lau’s arrest. Ms Chang was required to surrender Rukutai Street and the BMW as tainted property, purchased with proceeds of crime.
Commissioner of Police v. Lau and Chang – High Court (17.12.19)
20.017