Kiwi accused of German tax fraud establishes large property empire

While Paul Mora can enjoy life in a plush house overlooking the premier Clearwater Golf Course, his former business partner in a mammoth alleged tax fraud is being interrogated in a German court.

Martin Shields, 41, who worked with Mora mainly in London between 2000 and 2012, is currently before the Bonn regional court in Germany, answering questions about a complex tax scheme that allegedly deprived German taxpayers of countless millions.

Mora, 51, and Shields, an Irish maths whizz who studied at Oxford University, worked at the German bank HypoVereinsbank (HVB) from 2002 and together founded investment banking firm Ballance Capital in about 2008.

At HVB and Ballance, the pair made millions for clients and themselves through complex share transactions to get more than one tax refund on the same deal.

Mora is known for keeping a low profile despite his large frame and fondness for vibrant shirts.

Companies connected to Paul Mora own a good chunk of the Crowne Plaza building in Christchurch.


Companies connected to Paul Mora own a good chunk of the Crowne Plaza building in Christchurch.

Shields, who has been co-operating with authorities, is facing 33 charges of tax fraud relating to about $783 million income that was not declared to the German treasury between 2006 and 2011.

Mora, according to his lawyers at Bell Gully, has not been charged but is “under investigation” and has denied any wrongdoing. He is named 358 times in the 651-page charge sheet for the Bonn trial.

The Bonn court will have to determine whether the share transactions known as cum-ex deals (transactions designed to strip dividends) were legal and whether people participating can be convicted of crimes.

While Shields fights to stay out of jail, Mora has many investments and interests closer to home to look after.

The only property he owns in Canterbury in his own name is a 2000sqm section in Godley Drive that offers panoramic views of Christchurch city and the Southern Alps.

An 1800sqm section across the road with similarly spectacular views is, according to the title, owned by his mother Barbara Mora, his sister Alina Mora, and his current business colleague Chris Goldsbrough, a lawyer and former director of Deutsche Bank.

High-end apartments at 34 Cranmer Sq, Christchurch, will soon be on the market.

Martin van Beynen/STUFF

High-end apartments at 34 Cranmer Sq, Christchurch, will soon be on the market.

Mora’s family business empire in Canterbury is controlled from a spacious office in Cashel St which houses chief executive Goldsbrough and financial controller Alina Mora, who was previously a senior financial accountant for the Gough Group. The sign on the office door says M Family Holdings but the company does not appear to own any property in New Zealand.

Some of the family interests appear to be owned through a company called MC Christchurch Holdings, of which Mora was a director between August 2014 and May 2018.

In 2014 the company bought the former Forsyth Barr building on the corner of Colombo and Armagh Sts in Christchurch that has been occupied by the Crowne Plaza hotel since 2017. The company paid about $8m for the earthquake damaged 17-storey building and spent about $35m on repairing it.

The shares in the company are half owned by another company called M Family VSH Holdings, the shares in which are owned by Alina Mora, Christchurch curtain and blinds supplier Paul O’Loughlin, who lives with Alina, Barbara Mora, Chris Goldsbrough and Mora’s former colleague at Ballance Capital, Duncan Heyes, who lives in Surrey, England.

Paul and Katie Mora own the section in front of the house under construction.


Paul and Katie Mora own the section in front of the house under construction.

The same shareholders also own Mandm Properties which has a portfolio of assets including a high-end apartment/townhouse development at 34 Cranmer Sq, that is close to completion and a 938sqm block of land around the corner at 52 Kilmore St valued at $2.25m in 2016.

Alina Mora and Paul O’Loughlin declined to comment and Goldsborough did not respond to messages and texts.

Mora had a longstanding partnership with Christchurch developer Grant MacKinnon. The pair developed blocks of apartments in Kilmore and Dorset Sts but appear to have parted company.

McKinnon, who declined to comment, has, according to company records resigned as a director of Mandm and vacated his shareholding in the company.

52 Kilmore St, Christchurch, is ripe for development.

Martin van Beynen/STUFF

52 Kilmore St, Christchurch, is ripe for development.

Mora also appears to have an interest in a limited partnership (a corporate structure with separate legal personality that offers limited liability to investor partners) called The Winchmore Mitcham LP, which gives its address as the M Family Holdings office in Cashel St.

The partnership owns large dairy farms near Ashburton valued at around $30m and the Mora house in a private lane at the Clearwater Golf Course valued at around $2.5m.

On Saturday, law firm Bell Gully, which represents Mora in New Zealand, issued a statement on Mora’s behalf to say the ownership structures for the entities in which the members of the Mora family have an interest were “entirely commonplace and unremarkable”.

Last month Bell Gully told Stuff its client’s position was that the German authorities had “misunderstood and/or mis-characterised” the nature of the underlying transactions and his alleged role in them.

A property at 54 Godley Dr has one of the best views in Christchurch.


A property at 54 Godley Dr has one of the best views in Christchurch.

His position was also that it remained an “unresolved question in Germany as to whether cum-ex arbitrage is capable of giving rise to a criminal offence at all, particularly given that there were repeated initiatives by the German authorities to regulate the issue which did not make the practice unlawful”.

“The cum-ex investigations undertaken in Germany by the Cologne prosecutor are very extensive and Mr Mora is one of several hundred individuals and corporate entities currently being investigated,” Bell Gully said.

The charge sheet in Bonn indicates Mora began devoting more time to his New Zealand business ventures after 2012 when the German government tried to plug the tax loophole allegedly exploited by HVB, Ballance and many others.

Clearwater Golf Club, which one of Mora's properties overlooks, is among the premier golf clubs in the country.

Iain McGregor/STUFF

Clearwater Golf Club, which one of Mora’s properties overlooks, is among the premier golf clubs in the country.

It states he began dividing his time between New Zealand and Europe, with his interests listed as investments in dairy farms and real estate in New Zealand, as well as in real estate transactions in Spain.

According to reports from news agencies covering the Bonn trial, Shields, who first met Mora at Merrill Lynch, an American investment bank, when he was 23, has referred to Mora frequently.

Shields told the court avoiding taxation as far as possible was a “clear and openly communicated expectation of most major banks and their customers”.

In the five years Shields ran the trades, his personal income from the deals amounted to about $20m.

He told the court: “I often ask myself whether if I had my time again I would do things differently. Knowing what I now know, the answer is obvious. I would not have involved myself in the cum-ex industry.”

The trial, the first in a wider investigation aimed at recovering billions, is expected to finish in February. 

In a response to Stuff questions in 2017, Mora said he was an international investor with property interests in New Zealand “and elsewhere in the world (including the U.K.) and I travel frequently between those properties”. 

He talked about owning Arunvill Capital Ltd, and having investments in property, hedge funds, re-insurance, and technology and oil exploration companies.

HVB obtained advice on the cum-ex deals from Hanno Berger, “a respected and eminent German tax lawyer. I dealt with Dr Berger in relation to those transactions”, he said. 

Berger, known in Germany as “Mr Cum-Ex”, has also been mentioned in the Shields trial. The former tax official was charged with tax fraud at a court in Wiesbaden last year. From his base in Switzerland, he denies any wrongdoing and believes he is the victim of a witchhunt.

Arunvill Capital UK Ltd was put into voluntary liquidation in December 2015.

Its last accounts show a share premium account sitting at $15m and a profit and loss account with a $15m deficit.

Source link

Leave a Comment

Your email address will not be published. Required fields are marked *