A former banker from Singapore accused of laundering money linked to Malaysia’s 1MDB scandal used a tax haven company as part of an $8.2m-plus splurge on Gold Coast property over little more than a year.
Yeo Jiawei’s foray into Australian property began with a $1.3m luxury oceanfront apartment in Surfers Paradise, which he bought in 2014 direct from a collapsed developer.
Guardian Australia can reveal that Yeo is a director of a Seychelles-registered company that then paid a further $6.9m for commercial properties in Broadbeach, the tourist town’s trendy dining precinct, a year later.
Australian federal police are reportedly examining whether money illegally taken from Malaysia’s 1MDB state development fund has been parked locally. That investigation includes whether any Australian citizens, residents or companies breached proceeds-of-crime laws.
It is not known whether the AFP is examining the properties linked to Yeo, who was sentenced to 30 months in jail last month by Singapore’s district court for witness tampering during a Singaporean investigation into the alleged laundering.
The court in that case heard that Yeo had acquired $6m of Australian property while allegedly playing a central role in the illicit movement of S$23.9m ($22.6m) of 1MDB funds when employed as a wealth manager at BSI Bank Singapore.
Money-laundering charges against Yeo are due to be heard in April, with the 34-year-old having denied committing the offences.
Property records in Australia show that Yeo paid $1.3m in October 2014 for a fifth-floor apartment in the Soul building, the Gold Coast’s second-tallest highrise, which overlooks Main Beach at the heart of the Surfers Paradise tourist strip.
Two months later a Seychelles-registered company called Connect Capital Global Investments Limited, of which Yeo is a director, obtained an Australian business number. It also registered to pay goods and services tax, indicating a predicted annual income of $75,000 or more.
Connect Capital is based in the Seychelles, where it was registered with the help of Offshore Incorporations, a rival of Mossack Fonseca, the company at the centre of the Panama Papers scandal that shone on a light on the secretive world of tax havens.
In September 2015 Connect Capital registered with the Australian Securities and Investments Commission as a foreign company, lodging documents showing its local agent is Australian Taxation Accountants in Surfers Paradise, which provides its registered office.
The next month Connect Capital paid $2.4m for four retail premises, now housing pizza and seafood restaurants, in the ground floor of a building in Broadbeach.
A week before Christmas 2015 the company shelled out almost $3.4m for a further two retail premises nearby in Broadbeach, rented out to Italian and Brazilian restaurants. And four days later Connect Capital paid just over $1m for a neighbouring shopfront in the same building, leased to a doughnut business which pays more than $63,000 in rent a year.
A spokeswoman for Australian Taxation Accountants said the company had no idea of Yeo’s legal travails and said it was a “shock” to hear of his conviction and further charges.
The Australian newspaper reported on Monday that AFP officers were assisting at least one of the three known authorities — in Switzerland, the US and the Singapore — that are investigating where US$3.5bn allegedly looted from 1MDB, Malaysia’s sovereign-wealth fund, has wound up.
An AFP spokeswoman told the newspaper that officers were “assisting foreign law-enforcement partners in their investigations”. This included “evaluating” whether any Australian citizens, residents or companies had breached proceeds-of-crime laws, it reported.
“Given this matter is the subject of evaluation, it is not appropriate to comment further,” the spokeswoman said.
Federal police had not been in contact with Australian Taxation Accountants in relation to any of the properties owned by Connect Capital, a spokeswoman for the accountancy firm said.
Connect Capital was not required to seek Foreign Investment Review Board approval for its purchases as their value was below the $252m threshold for regular commercial property deals involving developed land.
Foreign non-residents are required to seek the board’s approval to buy residential properties but are normally allowed to purchase new dwellings.
Yeo’s $1.3m apartment purchase in 2014 was directly from the developer, Juniper Group, which had fallen into receivership in 2012. Developers of large projects routinely obtain “exemption certificates” to allow them to market off-the-plan apartments to overseas buyers.
1MDB was set up by Malaysian prime minister, Najib Razak, in 2009 “to drive sustainable economic development by forging strategic global partnerships and promoting FDI (foreign direct investment)”.
The US Department of Justice alleges it was illegally drained of funds by others including Najib’s associate the Malaysian businessman Jho Low, the alleged mastermind of the scheme.
The US has frozen about $1.3bn in assets so far, including profits from the Hollywood film Wolf of Wall Street; a Van Gogh painting and luxury properties in New York, Los Angeles and London. It alleges in a lawsuit that Low fraudulently received US$1bn from 1MDB, laundering more than US$400m into the US where the funds were used for “the personal gratification of Low and his associates”.
Singaporean authorities froze about $120m in assets held by Low and his immediate family last year. Low has said he occasionally consulted for 1MDB but denies any wrongdoing and he has not been charged either in the US or Singapore. Singaporean police regarded Low as a “key person of interest”, the court heard in Yeo’s trial.
Yeo’s conviction last month related to attempts to conceal his ties to Low and hide his wealth, which grew by $23.9m over just 15 months while he was a wealth manager at BSI.
Yeo denied wrongdoing throughout his trial, including the prosecutor’s claim that he received “secret profits” from a 1MDB money laundering scam.