Police take $5m of homes

Published by: Jared Savage, NZ Herald

Plumber declares $1000 income, police take $5m of homes

Global investigation into wealthy businessman Edward Gong probes his links to New Zealand and the tax affairs of his brother in Auckland.
An Auckland plumber who declared less than $1000 in income over five years has lost nearly $5 million worth of property following an investigation into his tax affairs.

Yu Ping Gong and his company earned $2.1m in that time, according to the police, who claimed the undeclared income paid for a property portfolio worth more than $9m.

The eight properties were frozen by the High Court under the Criminal Proceeds Recovery Act when the police alleged Gong had profited from tax evasion.

He denied tax evasion but agreed six of the eight Auckland properties, worth $4.9m, can be sold in a deal cut with the police.

An outstanding tax bill of $1.2m will be paid to Inland Revenue as Gong wishes to “regulate his tax affairs”, according to Justice Edwin Wylie in his judgment which approved the settlement.

The Weekend Herald can also reveal Gong’s tax affairs came to light as part of a separate investigation into his brother, Xiao Hua Gong, accused of running a $202m pyramid scheme in China.

Better known as Edward Gong, the wealthy businessman has built an 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.

Edward Gong was arrested in Canada and charged with fraud and money laundering last December in connection to the alleged pyramid scheme involving the “fraudulent sale of hundreds of millions of dollars” in shares in China.

Detectives in New Zealand discovered Edward Gong transferred $77m – allegedly profits from the pyramid scheme – into New Zealand bank accounts over seven years.

Nearly $70m has been frozen under the Criminal Proceeds Recovery Act – easily the largest amount since the law came into force in 2009