Catch him if you can: the mysterious escape of Malaysia’s second richest man
Luxury: An artist’s impression of the Wylde Street development
(Sydney Morning Herald) – ”The bulk of our work was never paid for,” Greg Crone says. ”We were shocked when he sold up and then just disappeared off the face of the earth. When someone like this just disappears and leaves a shitload of debt it is just unbelievable.”
Onn Mahmud was a wealthy tycoon with a bulging property portfolio when he jetted off without warning in 2007.
Number 10 Wylde Street, Potts Point, commands views to die for on a harbour not short of heart-stopping vistas. Perched high above Woolloomooloo Bay, it faces directly across the sweep of the botanical gardens to the Opera House and the Sydney Harbour Bridge.
For a while, a few years ago, it was the site for one of the most luxurious apartment developments in Australia. In 2008, the duplex penthouse in the five-storey project was sold off the plan for a record price of $20 million.
A year earlier – on the cusp of such riches – the Malaysian tycoon who had brought the project close to fruition abruptly sold the site as he quietly folded most of his substantial Sydney property portfolio and exited the Australian business scene.
After initially being offered privately for a firesale price $9.4 million, 10 Wylde Street was eventually sold for $15.5 million – less than its spectacular penthouse had been on track to fetch and way below the projected revenues of $50 million for the entire redevelopment of the old Oakford serviced apartment building.
Virtually no one knew it at the time, but what appeared to have been a disastrous investment reversal in a booming market was, in fact, still a bonanza for a man with money to burn.
Onn Mahmud is the second wealthiest man in Malaysia, with a fortune estimated to be in excess of $2 billion. Malaysia’s richest man is his brother, Taib Mahmud, Chief Minister of the eastern state of Sarawak and reckoned to be worth more than $15 billion.
Much of that wealth has come through the family’s control of logging deals that over the past 30 years have levelled most of the tropical rainforest on the island of Borneo. And a substantial slice of that wealth has found its way into investments in Australia.
Onn Mahmud bought 10 Wylde Street in the 1990s through his company, Ryan Park Limited, for $4.7 million. The windfall profit of $10.8 million netted from the 2007 resale had a sugar coating for the vendor – no tax was paid on the huge capital gain and nothing was returned to the project manager or architect, who were owed millions of dollars in fees and commissions by Onn.
Documents obtained by Fairfax Media show that Onn’s Sydney property empire was carefully constructed behind an Australian corporate facade. Real control lay in a network of offshore companies and trusts based in the Cayman Islands and managed by banking giant Merrill Lynch from offices on the Isle of Man – a structure that enabled Onn to avoid paying Australian tax on tens of millions in Australian profits.
The NSW land transfer lodged after the sale in early 2007 of Wylde Street to another developer (which in turn folded its hand in the face of the later global financial crisis) confirmed that the ultimate owner of the property bought in the name of Ryan Park Limited was a trust registered in the Cayman Islands, operated out of the Isle of Man and controlled by Onn Mahmud. The beneficiaries of that trust were members of Onn’s family based in Singapore.
In a statutory declaration sworn on the Isle of Man on March 29, 2007, two Merrill Lynch officers, Nicholas Dearden and Yvonne Smallwood, confirmed that Ryan Park Limited was registered proprietor of Wylde Street but asserted that it was ”an unregistered foreign company” and that the company ”does not carry on business in Australia”.
Yet when Onn Mahmud had applied for an Australian business visa in 2002, his sponsor was Ryan Park Limited and he had declared that it and several associated companies had invested more than $50 million in commercial properties in Sydney. While Ryan Park had obtained an Australian Business Number in November 1999 as an ”Australian private company”, it was not registered for GST and had never been registered with the Australian Securities and Investments Commission.
Read more at: http://www.smh.com.au/world/catch-him-if-you-can-the-mysterious-escape-of-malaysias-second-richest-man-20130427-2ildf.html