Jailed Crafar farms bidder defaults on mortgage

Property

One of the masterminds behind a fraudulent bid to buy the Crafar farms has defaulted on an ASB mortgage over one of his frozen Auckland properties

12th Dec 17, 12:40pm by Jenée Tibshraeny

By Jenée Tibshraeny

A failed Crafar farms bidder, who was jailed last year for laundering money and conspiring to defraud, has defaulted on a mortgage over a house he owns in South Auckland.

ASB has issued a public notice calling for Ke En Chen, otherwise known as Jack Chen or Chen Keen, to pay $8,900 by January 12 to avoid ASB taking possession of the property.

Chen is best known in New Zealand for acting as a middleman with May Wang in a failed 2009 deal to try to buy 22 North Island farms for Chinese interests at a price of $500 million.

The Crafar farms group was put into receivership in October 2009 owing about $216 million to its lenders Westpac, Rabobank and PGG Wrightson Finance after interest.co.nz revealed animal welfare issues at the farm.

In June 2016 Chen was sentenced at the Court of First Instance in Hong Kong to seven years and nine months in jail for conspiracy to defraud and laundering more than HK$85 million (about NZ$16 million at Tuesday's exchange rate), in relation to the Crafar farms deal.

In 2013 several properties owned by Chen and his associated interests were frozen by a foreign restraining order, instigated by Hong Kong authorities.

The mortgage Chen has now defaulted on is over one of those properties - a house at 12 Magnolia Place, Flat Bush.

ASB has a first mortgage on the property, securing up to $750,000, but it is not known how much is currently owed on the mortgage.

According to QV, the property was valued at $475,000 in 2008. Its current capital valuation is $940,000.

Court documents clarify the “foreign restraining order” on the property doesn’t include ASB’s interests in it.

Chen either on his own, with a woman believed to be his wife (Fang Ye), or through a company he was the sole shareholder of, Anfatex Global Financial Investment Holdings, is also the registered owner of six other properties:

4 Lammermoor Drive, St Heliers
8 Lammermoor Drive, St Heliers
16 Bridgewater Rd, Parnell.
5 Grampian Road, St Heliers
26 Somerville Road, Howick
28 Somerville Road, Howick

These properties are subject to the same overseas restraining order as the Flat Bush property. According to QV, all seven properties have a combined valuation of $28 million.

There is a BNZ mortgage over the Parnell property.

The exact ownership of the three St Heliers properties is uncertain.

Their titles say they are owned by Anfatex Global Financial Investment Holdings. But according to Companies Office records, the company was removed from the Companies Register in July 2016, which means the three properties appear to be owned by a company that no longer exists.

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33 Comments

by bilbo | 12th Dec 17, 12:57pm 1513036675

Is this guy one of the 3% foreign buyers I keep hearing about?

by NorthernLights | 12th Dec 17, 4:57pm 1513051078

He’s one of the “ Entrepreneurs “
allowed in under the National “Open the taps immigration policy”

by Macadder | 12th Dec 17, 11:04pm 1513073091

And likely to be shoulder tapped for a National party candidacy once he is released from prison.

by NorthernLights | 13th Dec 17, 10:37am 1513114661

If he pulled girls ponytails he might make leadership

by J.C. | 12th Dec 17, 1:00pm 1513036838

NZ is a wonderful place to park money and a stage to to pass yourself as a credible business person or investor, even if you're a 2nd-rate crook or fraud.

by Smalltown | 12th Dec 17, 2:07pm 1513040828

Or even get yourself elected as PM for 8 and a bit....
Kiwis so dumb lah.

by BearBear | 12th Dec 17, 2:56pm 1513043790

Or come in still with ties to CCP and becomes a MP to further CCP's interest and double dipping from both side.

by NorthernLights | 12th Dec 17, 5:38pm 1513053539

Small town
The issue with kiwis is the media/ society veers toward the miopic
At least provincial NZ has soul
Auckland does get a soul during the Santa parade Xmas in the park and America’s Cup & All Blacks but that’s about it. The poor city even got screwed out of housing the countries TePaPa to tiny 250K pop Wellington
Probably because Wellington has a soul Auckland lacks

by NorthernLights | 12th Dec 17, 5:01pm 1513051292

A National MP was only to happy to fix a migrant entrepreneurs tap washers
How dare they be called crook

by john wheeler | 12th Dec 17, 1:07pm 1513037238

A start of what is to come.

2018 - THE YEAR OF THE CRASH.

by CWBW | 12th Dec 17, 4:54pm 1513050874

This market is exhibiting the symptoms like others before it everywhere else in the world. First is the stalling of apartment sales as hordes of developers overbuild in lieu of perceived demand for investment properties and housing.

Next you see those fraudulent deals coming to light as they cannot withstand scrutiny during any downturns. Those fradulently obtained mortgages will come first as these people had inflated their assets and income or declared non-existent money while obtaining a mortgage. Just how in the world does a nurse whose partner is receiving benefits and working in DHB owns 5 investment properties or an air NZ stewardess owns 4 baffles me.

Those working in larger finance entities would have known by now that the last 6 months the mortgage office had been frantically siffing out high risk loans and planning their risk mitigation whilst keeping the good serviceable loans. Those mitigation plans (some are hard takes) will only result in more dodgy deals and mortgage brokers coming into light with many casuaties. And why be suprise that the bank suddenly asks you to clarify your current financial position and income- you aren't the only one.

Next we're going to see more attempted interventions by the government or RBNZ when the slide becomes seriously dire for the economy and real estate companies coming up with more creative marketing like package deals with boats and cars or buy the whole ghost town Bennydale nonsense.

Curiously, is that Fang Ye in the article the same person as the agent working in Barfoot and Thompson?

You know it had really tipped when you see more and more properties related fraud surfacing. The news only has space for those that they think are the more sensational ones. For every reported fraud there are many others not reported but you can search them after the proceedings online.

Merry Christmas.

by rmnz | 12th Dec 17, 2:55pm 1513043709

It also indicates that the banks have learned next to nothing since 2007, still lending to people without a real grasp on who they are, the source of their funds, ability to meet obligations etc etc.
Banks are already starting to quietly clean up their mortgage books but expect to see more and more declines on loan decisions.

by Solidname | 12th Dec 17, 3:34pm 1513046085

I've said this before, and I still think this is the biggest elephant in the room, there's been a lot of talk about the factors of the GFC not being apparent this time around. They are here, people have been lying about their income to get credit - This is exactly what caused the last crisis, this time around it's moved up a socio-economic level, add to the fact we are no longer protected by Australia's mining economy and China's economic juggernaut - which stymied the major effects of the last GFC.

by NorthernLights | 12th Dec 17, 5:30pm 1513053012

Solidname
You’re right

by Bobster | 12th Dec 17, 5:51pm 1513054295

Yep, I suspect there has been a good amount of questionable lending. This will all become apparent when some borrowers start to default. The banks have be very aggressive in terms of market share, I suspect in some cases they have cut their own throats.

by NorthernLights | 12th Dec 17, 5:27pm 1513052877

CWBW
Interesting what you say about developers building apartments when sales are stalling
There’s some really nice apartment buildings nearing completion near where I live
Apartment units around 2000Sqft designed primarily for retirement I guess and there’s no advertising anywhere about them The buildings go up and no billboards nothing They aren’t sold off the plan either they’re just built & it’s amazing to see no marketing . It’s like build & they will come
Such hubris in the market might end in tears for developers & a bargain for others

by Alter Ego | 12th Dec 17, 5:06pm 1513051599

ASB should be paying him, he did them a favor ...

ASB has a first mortgage on the property, securing up to $750,000, but it is not known how much is currently owed on the mortgage.

According to QV, the property was valued at $475,000 in 2008. Its current capital valuation is $940,000....

Plus this lifted every other dumb waiter and fraudster and speculator to have to pay more for a similar property....for months and months

Plus they got some return, till it all turned to custard, plus they can now have a lot of rentals, when the other lot go into more debt and they can foreclose on each and every one,

Plus they con-joured the munny out of thin air.....so they cannot lose....and even got a commission for it.

Plus they may have had a large Foreign deposit as part of the deal....plus ...plus...plus. Houses never go down in value.......Do they???.

by TainuiBabe | 12th Dec 17, 5:47pm 1513054064

ASB will be taking a rather large loss on this deal. Our banks source money largely from the US banks because New Zealanders don't save, so I am not sure why you think that these fraudulent loans won't start to cripple our banks. They aren't able to get cheap credit so easily these days from our foreign suppliers. Get ready for a Credit downgrade and higher interest rates.

by Robt. | 12th Dec 17, 5:09pm 1513051762

Do you suppose that if NZ citizens, companies or Govt. suffer significant financial stress the Chinese govt.entities might be there to generously buy up our assets?

by NorthernLights | 12th Dec 17, 5:25pm 1513052751

Robot
Of course the CCP will bail out NZ
The whole strategy by the CCP has been to allow its people freedom to buy up RE property all over the western nations and rachet up the prices
The CCP bank will make the government a take it or leave it offer to do as they wish on
certain issues or face the bank of C foreclosing on properties they’ve secured mortgages on thus triggering a potential prick of the housing ponzi bubble
I’m sure something can be worked out by giving away a few more farms in productive regions
NZ is playing with a country of 1380Million people It was never going to be an equal free trade agreement

by TainuiBabe | 12th Dec 17, 5:49pm 1513054153

CCP won't be bailing out anyone as long as Winston Peters and the Labour party are banning foreigners from purchasing.

by NorthernLights | 13th Dec 17, 6:42am 1513100528

Dear TainuiSue
The bank of C holds the titles
Comprendo ?

by TainuiBabe | 14th Dec 17, 10:30pm 1513243857

Apologies. You might be right on this one. Properties ARE being confiscated by the CCP for their citizens who have bought property in NZ via laundered money and as I understand it, our banks who loaned money blindly have NO recourse on these via an international legal document to seize the asset.

by Belle | 12th Dec 17, 9:42pm 1513068166

My memory might have failed me but as I recall Wangs offer to buy Crafar farms was circa 200mil, not the 500 quoted.

by Andrewj | 12th Dec 17, 9:57pm 1513069068

HI Belle, we are getting dry, how are things with you?

by NorthernLights | 13th Dec 17, 6:43am 1513100614

Do I hear Farrrrmers ?
Dry
If so it explains a lot A

by TainuiBabe | 14th Dec 17, 10:33pm 1513244027

I work with a couple of dairy farmers wives and they are stressed out about making decisions to start culling their stock due to water shortages. They live in the Manawatu area and we haven't had any decent rain for weeks!

by Belle | 13th Dec 17, 9:47pm 1513154846

We were ok til the wind started blowing two days ago. We got a couple of downpours a 10 ml and a 20 ml, but the wind has sucked that out and it could get pretty ugly. Lambs were ridiculously cheap at last weeks sale.

by CJ099 | 13th Dec 17, 9:39am 1513111145

Looking at all that expensive property that they purchased in Auckland central suburbs, makes you wonder how much of central Auckland"s very expensive property has been bought up using ill gotten gains and dodgy loans in the last ten years or so? I think it's extremely high, I think you're looking at say a good 60 to 70%

I wouldn't be surprised if we continue to have further news on property sales falling. It's fascinating to see how since China's clamp down on money laundering that our AKL property sales have dried up especially in the expensive areas.

I really hope that that Labour will push ahead with the foreign buyer ban or at least a tax.

by two otherguys | 13th Dec 17, 9:43am 1513111424

Interesting question
What is the legal status of assets of a company that is "de-registered" by the companies registrar

Property of a company removed from the Companies Register
Section 324 of the Companies Act 1993 provides that property belonging to a company vests in the Crown with effect from the removal of the company from the Companies Register. Similar provisions exist in previous Companies Acts and, depending on when the company was removed from the Companies Register, may apply

http://www.treasury.govt.nz/abouttreasury/services/bonavacantia/section…

The company was de-registered in 2012 and the bank is only moving now - 2017?
Wonder if the properties are vacant, un-occupied, derelict or maintained

by russellj | 13th Dec 17, 11:47am 1513118832

Excellent point - and the answer is ...... if dereg in 2014 then the Crown must own subject only to the mortgage - so WHO in the Govt/bureaucracy is responsible for acting on this and WHY HAVEN'T they ???

by two otherguys | 13th Dec 17, 9:44am 1513111455

Were Jack Chen or May Wang ever NZ citizens

Jack Chen is certainly no longer resident in NZ

by NorthernLights | 13th Dec 17, 10:12am 1513113125

Weren’t they National Party donors ?
If you had a beach house the Nats would watch over your house I heard & fix ta washers