Movie profits hidden in HK trusts
Crocodile Dundee star Paul Hogan and producer John 'Strop' Cornell allegedly used Hong Kong trusts to hide more than US$100 million earned from the popular films to avoid paying tax, a press report in Australia said.
Legal documents allegedly show how royalties from the 1986 hit and its sequel were sent overseas through a web of companies controlled by at least seven secret trusts in Hong Kong, according to a report in The Sydney Morning Herald yesterday.
Hollywood studio 20th Century Fox and celebrity lawyers Nigel Sinclair and Craig Emanuel structured production deals to deliver enormous profits to Hogan and Cornell, it claims.
The royalties flowed from Hollywood to companies in the Netherlands, where Hogan and Cornell had assigned the copyright to their films. Those companies acted as conduits to bank accounts in the Netherlands Antilles and secret trusts in Hong Kong, the paper said.
The documents were allegedly unearthed during a criminal investigation into the tax affairs of Hogan, Cornell and a Sydney adviser, Tony Stewart. The commission alleges the trio may have defrauded taxpayers of millions of dollars.
Lawyer David Rydon, for Hogan, Cornell and Mr Stewart, told the paper his clients were unfairly barred from publicly defending themselves because of secrecy provisions in the Australian Crime Commission Act.
Hogan is not the first Australian celebrity to allegedly use Hong Kong to avoid paying Australian tax.
It emerged in July 2005 that the fortune of dead rock star Michael Hutchence, estimated to be between HK$10 million and HK$20 million, had vanished.
Hutchence's financial advisers said profits from rock bank INXS were squirreled away through a web of companies across the globe to keep his fortune away from 'thieving relatives' and 'girlfriends'.