Mega CEO responds as Yan's shares restrained under Criminal Proceeds (Recovery) Act

Mega founder and 'principal strategist' Kim Dotcom. The file sharing site is set to reverse list on the NZX on October 31

UPDATED: Mega CEO Graham Gaylard says the data storage and encryption company is “still driving towards its listing date of October 31st”, despite 18.81% of Mega’s shares now being in the custody and control of the Official Assignee.

“At this stage we don’t have any concern with the timing or the process of listing,” Mr Gaylard says. “Of course, anything can happen in the future but at this stage we don’t see any difference.”

Mr Gaylard says his current understanding is that Mega’s backdoor listing through TRS would be able to proceed even if the 18.81% of Mega shares currently subject to the restraining order under the Criminal Proceeds (Recovery) Act remain in the custody of the Official Assignee.

The shares, which NBR ONLINE understands are held by the companies T E Y Trustee Limited (a total 17.14% of Mega shares) and New Vision Trustee Limited (1.67% of Mega shares), are among millions of dollars of assets associated with William Yan (also known as Bill Liu) that have reportedly been seized by police.

The beneficiary or beneficiaries of T E Y Trustee Limited and New Vision Trustee Limited had not previously been made public. Both companies list Jesse Nguy of Auckland-based Jesse & Associates Barristers & Solicitors as the sole director.

According to media reports, the seizures have happened as a result of a police investigation into a money laundering ring.

Meanwhile, TRS placed a trading halt on its shares at 3.42pm, pending an announcement from the company, but the halt was removed just 15 minutes later.


EARLIER: Mega CEO Graham Gaylard has issued statement confirming that 18.8% of Mega’s shareholdings are subject to a restraining order under the Criminal Proceeds (Recovery) Act.

The shares, registered in the names of two companies, are related to property associated with William Yan (previously known as Bill Liu) and others, Mr Gaylard’s statement states, and are now under the Official Assignee’s custody and control.

Despite this, “it is business as usual” for the data storage and encryption company, Mr Gaylard says.

He notes that, as a limited liability company, Mega, “is quite separate from its shareholders and is not responsible for the actions of shareholders or their finances” and that the Police have said “their action does not affect any innocent third parties (such as Mega) who have had business dealings with Mr Yan”.

 “Mega has been extremely diligent to ensure that all its operations are fully compliant with all legal and regulatory requirements,” Mr Gaylard says. “Mega does not undertake any illegal activities and does not wish to be associated with any such activity.”

Mr Gaylard says Mega had no reason to suspect that any funds received for shares were the result of illegal activities.

The funds were paid to the company’s lawyers by the shareholder’s lawyers via banks that operate stringent anti-money laundering processes.

NBR has asked the Official Assignee for comment.

Mega recently appointed Shane Te Pou as its HR manager.

Several years ago, Mr Te Pou was embroiled in controversy about the granting of citizenship to William Yan under the previous Labour-led government.

Until recently, Mr Te Pou had been a senior member of Labour’s Tamaki-Makaurau electorate committee.

Mega recently extended the deadline for its reverse listing on the NZX for a second time. 

The involvement of TRS Investments, the Australian company being used as the vehicle for the reverse listing, earlier prompted a warning from the Shareholders Association.

In December ASIC hit TRS majority shareholder Paul Choiselat with 25 charges relating to market manipulation, including concealing his interests in shares of listed companies and falsely boosting a debt claim.

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