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By Sunday, 24 September 2023

Struck-off New Zealand shell company summoned to court in connection with $36m fraud

A Hong Kong financial regulator has summoned a struck-off New Zealand shell company to appear in court in connection with a HK$170 million (NZ$36m) fraud.

Maxim Capital Ltd was deregistered from the NZ Companies Officein September 2015 a few months after Taiwanese authorities busted an illegal investment scheme known as Maxim Trader, finding bundles of cash, luxury cars, jewellery and other items.

An investigation determined the company was operating an international pyramid scheme, preying on investors in Asia and Australia.

Maxim Trader was supposedly managed by Maxim Capital, initially incorporated in New Zealand but subsequently shifted to the Seychelles.

Hong Kong’s Securities and Futures Commission (SFC) found that Maxim Capital and Maxim Trader had solicited over 260 investors to invest more than HK$170 million in investment schemes between 2013 and 2015 that claimed to pay “guaranteed” monthly returns of up to 8 per cent.

Authorities found bundles of cash when Maxim Trader was raided in 2015.
Authorities found bundles of cash when Maxim Trader was raided in 2015.

Investors were initially able to receive monthly returns on their investments, but those payments stopped in July 2015 and it soon emerged it was really a giant Ponzi scheme.

Investors were further duped when they were informed by Maxim that their investments had been converted into shares of a US stock exchange-listed company which then turned out to be worthless.

In 2018 13 Maxim Trader executives and employees were found guilty in the New Taipei District Court of defrauding investors, including Maxim’s Taiwan chief executive Chang Chin-su, who was sentenced to 11 years in prison and fined NT$100m (NZ$5.24m).

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In March 2020, three more people were convicted of promoting the scheme, including Maxim Capital chief executive Andrew Lim Ann Hoe, who was jailed for eight months.

This month the SFC placed advertisements in newspapers in Asia notifying that Maxim Capital and Maxim Trader were summoned to appear in Hong Kong High Court on Monday, September 25.

An advertisement in Malaysia's Sun Daily Newspaper notifies the court hearing in Hong Kong.
An advertisement in Malaysia's Sun Daily Newspaper notifies the court hearing in Hong Kong.

A hearing had been fixed to seek further directions in relation to a June 2022 judgment ordering the two companies to repay investors.

Last year the Court of the First Instance in Hong Kong ordered Maxim Capital and Maxim Trader to pay investors in connection with the investment schemes.

While most investor funds appear to have disappeared, the SFC did obtain orders in November 2015 to freeze monies totalling HK$23.5m (NZ$5m) held by Maxim Capital with a licensed money service operator in Hong Kong.

The court appointed administrators to receive, administer and distribute the frozen monies to the affected investors on a pro-rata basis.

Records show Maxim Capital was incorporated in New Zealand on October 26, 2012, and its original sole director was Elena Christodoulou, a company adviser in Cyprus who had no connection with the investment activities.

Joaquim Magro De Almeida, a mysterious Portuguese resident, was also briefly a director of Maxim Capital and would later appear in the Panama Papers for his involvement in controversial shell companies.

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Before it was struck off in September 2015 the company’s sole director was Singapore-based Andrew Lim Ann Hoe, who was arrested, convicted and sentenced to prison in 2018 for his part in promoting the scheme.

Maxim Capital was struck off in 2015.
Maxim Capital was struck off in 2015.

Duncan Bridgeman is managing editor of NZME Business, including the Business Herald and BusinessDesk.

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