NZ police seize cars of disgraced former HK officer

PUBLISHED : Sunday, 07 August, 2011, 12:00am
UPDATED : Sunday, 07 August, 2011, 12:00am

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A disgraced former Hong Kong policeman living off sickness benefits in New Zealand has been stripped of his three luxury cars despite being acquitted of money-laundering and drug charges after a court ruled that they were purchased with profits from drug dealing.

Police seized the vehicles of Paul Yu Hung-szeto, also known as Yu Hong-ho, when he was arrested on charges of money-laundering and dealing in methamphetamine in December 2008. Police alleged that Yu's wealth came from drug profits. Yu's defence was that it came from other sources, including gambling.

He was acquitted this year after a seven-week trial at Auckland's High Court, where his co-accused, multimillionaire businessman Max Beckham, was found guilty of serious drug and money-laundering charges.

The cars were to have been returned to him on his acquittal. However, last month police again seized Yu's 2005 Mercedes-Benz SLK convertible, 2003 Mercedes sedan and 2005 Porsche Cayenne, worth a total of NZ$250,000 (HK$1.66 million), under the new Criminal Proceeds (Recovery) Act 2009.

The law grants police the power to confiscate property without proving a crime occurred.

The evidential threshold is lowered from 'beyond reasonable doubt' to the 'balance of probabilities' and the onus is on defendants to prove how assets were paid for.

Yu did not contest the confiscation application and a High Court judge ordered that his three cars be forfeited to the police. New Zealand police did not comment on Yu's acquittal, but a source with knowledge of the court case and police investigation was more forthcoming.

'What is the most interesting thing is that [Yu] did not challenge the seizure of his cars. If he had legitimately paid for the cars, he could have fought for them.

'By doing this, he has effectively conceded they are the proceeds of crime - despite being acquitted in court. The rumour going around is that he is a police informant, but who chooses what intelligence to pass to police to suit his own agenda. He's a very dangerous character.'

Yu, now 59, was convicted in New Zealand in May 1991 of injuring with intent, causing grievous bodily harm and attempting to pervert the course of justice.

Police said he ordered two men to beat up the owner of a Chinese restaurant in Hamilton who owed a business associate NZ$5,000. The victim's brother-in-law intervened with two meat cleavers, but was stabbed in the melee. Yu was sentenced to four years in prison.

His lawyer revealed at the 1991 court hearing that Yu had been dismissed from the Hong Kong Police Force because of a criminal conviction. After serving his sentence, Yu returned to Auckland, where he became a familiar face at the SkyCity casino as a loan shark.

He had received sickness benefits for almost a decade, and had been granted a taxpayer-subsidised house, although he was secretly living in an upmarket Auckland suburb.

In a statement, Detective Superintendent Peter Devoy, head of the police financial-crime group in Auckland, said Yu's was the most noteworthy case yet of assets being confiscated despite an acquittal.

'The Criminal Proceeds [Recovery] Act means that while someone might be able to walk away from the courts without a conviction, we can still strip them of the profits of crime.'

$1.66m

is the value, in Hong Kong dollars, of the three luxury cars that were seized by New Zealand police from Paul Yu