Nobu Su: ‘Wayward son’ or ‘an inveterate liar?’

If one person puts money into a purse and another controls the way it is spent, who owns the purse?

That was the rhetorical question at the centre of a hearing in London this week which provided the latest legal developments in the life of Nobu Su, the jailed Taiwanese shipowner.

Claimants Polys Haji-Ioannou and Lakatamia Shipping argued that defendants Su and his mother Toshiko Morimoto should be tried for frustrating court orders.

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Morimoto, 85, could face trial if the Court finds she has helped her son circumvent a worldwide freeze on his assets and avoid repaying the judgment debt against him.

Su has already begun a 21-month jail sentence for contempt of court in London’s Pentonville Prison, one of London’s oldest custodial facilities, which is notorious for its poor conditions.

A 2018 inspection by the UK’s prison watchdog found the Victorian prison to be “rife” with vermin, “overcrowded and crumbling” and that drugs, weapons and mobile phones are commonly smuggled in.

Sources close to Haji-Ioannou told TradeWinds that Su “could walk out of prison tomorrow, if he pays the money”.

Allegations presented at this week’s hearing suggested that Su does have access to liquidity, via possibly illicit transfers from his mother.

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The question is: did Morimoto pay money to her son that had been obtained from the sale of his assets, which have been frozen since 2011?

Haji-Ioannou and Lakatamia claim Su and his mother (and others) together acted in a conspiracy to frustrate the freezing order and payment of the judgment sum.

The claimants have this week filed an application through their lawyers Hill Dickinson to continue a freezing injunction they have obtained against Morimoto herself and move towards a trial.

Cypriot shipowner Haji-Ioannou is the head of World Tankers Management and is not to be mistaken for the similarly named Polys Hajioannou, chief executive of Safe Bulkers.

Villa sales in the spotlight

Haji-Ioannou’s legal team believe €27m from the sale of Su’s two villas in Monaco – which was previously thought to have disappeared – was funnelled to Morimoto, who then used the money to make payments on Su’s behalf.

“She holds the purse strings, even if the money in the purse has been placed there by Mr Su,” the claimants’ barrister Stephen Phillips QC told the Court on Wednesday.

Following the villas’ sale in 2015, the net proceeds were paid to lawyers of Cresta Overseas Ltd, of which Su was the ultimate beneficial owner through another entity, Portview Holdings Ltd.

The proceeds were previously thought to have disappeared after being paid to Cresta.

However, a recently unearthed bank statement shows the cash was received into a Taipei-based Citibank account belonging to Up Shipping, which the claimants allege was controlled by Morimoto.

Morimoto has said she first became aware of the villas’ sale in March 2017, according to her witness statement, which was quoted in court by Phillips.

She stated that she knew that the villas belonged to Su but she didn’t know who owned Up Shipping.

Morimoto also stated she transfers money to Su’s American Express card when he can’t pay it.

“What is Mrs Morimoto doing, funding Mr Su’s lifestyle if she thought that he had received €27m?” Phillips said, referring to the sale proceeds.

“Because it’s her money. She holds the purse strings,” he said.

When cross-examined in court in February, Su said Up Shipping belonged to his mother.

“My mum want [sic] to control everything,” Phillips quoted Su as saying.

“That, my Lord, is the true position – not that Mrs Morimoto is an elderly innocent,” Phillips told the Court.

Similarly, the claimants allege that Morimoto lied to the Court in denying that she is the beneficial owner of a company called Great Vision Management, which made payments to fund Su’s legal fees.

Phillips referred to a witness statement from an associate of Su’s father, Tai Chou Chang, who stated he was the sole shareholder of Great Vision, but holds the shares as a nominee for the true owner, whom Chang said is not Su.

Chang said Great Vision had paid the legal fees because of the personal family relationship between the owner of Great Vision and Su.

‘In it together’

Because of this, the claimants allege that the true beneficial owner of Great Vision can only be Morimoto.

She was the first person Su called when he landed at Heathrow Airport in January and had his passport confiscated, subsequent to an injunction filed by the claimants’ lawyers, Phillips continued.

Su told her he was in trouble and needed money to pay for a taxi to Liverpool, from where he attempted to flee the jurisdiction by catching a ferry to Ireland, Phillips said.

Soon after, two deposits of TWD 180,000 were made to Su’s Amex card, he continued.

“It demonstrates there needs to be a trial. The money arrives at the exact moment it’s needed. It’s part of a conspiracy – Mrs Morimoto and Mr Su are in it as an entity together,” Phillips told the Court.

'An inveterate liar'

Morimoto’s barrister David Head QC dismissed the suggestions during the hearing this week.

“The general approach of the claimant is irregular and wrong in response to the claim,” he stressed.

The evidence is that she has funded her wayward son for many, many, years.

Stephen Phillips QC

The claimants have known about the villas’ sale for several years, but have not brought any applications in the appropriate jurisdictions to find out what happened to the proceeds or to take action against those moving it around, Head argued.

The particulars of claim, however, show that in October 2015 Lakatamia's lawyers did in fact take legal action in Monaco to delay the villas' auction — but failed.

The claimants later obtained judgments in Monaco and the Cayman Islands in 2017 to enforce the London court award in their favour and Su's liability to repay the judgment debt.

The defence argued there is no evidence to suggest Su and Morimoto acted together in a conspiracy or that they acted to conceal the proceeds, he continued.

Rather, Head said, the claimants’ allegations are based solely on oral evidence provided by Su, whom the barrister described as “an inveterate liar”.

In fact, Su’s evidence would appear to show that, rather than conspiring together, Su and his mother were not on the best of terms, Head explained.

“He said the [villa] money was transferred to her and he tried to get it back. Far from there being any sort of pact between them, Su appeared to have an adverse relationship with her,” Head said.

“The evidence is that she has funded her wayward son for many, many, years,” he told the Court.

“On Mrs Morimoto’s own accounts, she has perhaps overindulged her son, perhaps overgenerously.”

During his cross-examination earlier this year, Su said that his mother was aware of the freezing order, but was not asked when she first gained knowledge of it, Head told the Court.

The cross-examination was conducted with respect to Su’s assets, Head said, not those of his mother.

“That is not a good basis on which to base an argument that she was aware [of the injunction] in 2017,” said the defence counsel.

Morimoto's witness statement, Head said, says she first became aware of the freezing injunction when her son called her from Heathrow Airport in January this year.

Outrageous claims

Head made that point that Morimoto’s name is not mentioned in any of the documents that have been obtained as evidence to date.

“Nobu Su is a liar who chooses to change the ultimate beneficial owner of a company when it chooses him,” Head said.

“It is outrageous to say that when a company is not owned by him, it must be owned by [Morimoto]. That will not do,” he went on.

“One only has to look at the bank statement. It’s perfectly clear that it was a piggy bank for Nobu Su.”

Head said the Up Shipping bank statement shows numerous transactions ostensibly made on Su’s behalf, such as monthly payments to his lawyers.

One of Su’s known creditors, Sparkle Wood Ltd, received $1m from the account, and the Queenwood Golf Club, of which Su is a member, received around $37,000.

Tempo Productions, the film production company that made The Outsider, received around $260,000, Head said.

Around $8m was transferred to an entity called Blue Diamond Transport, which has links to one of Su’s consultants, the Court heard.

Over time, Blue Diamond paid money back into the Up Shipping bank account over numerous transactions, Head said.

He also said that Monaco law was the most applicable to the tort, refuting the claimants’ argument that English law should apply because the alleged conspiracy was to frustrate an injunction handed down in England.

Judgment reserved

During the hearing, the Court acknowledged that any trial of the businessman and his mother would need to be a speedy one, before Su is freed from prison and is able to leave the jurisdiction.

The judge has reserved his judgment, which he said would “probably” not be handed down before the Easter weekend (April 19).

In the meantime, the freezing order on Su’s assets will continue until the Court delivers a further order.

The case continues.

* This article has been updated with further details on the legal proceedings in Monaco.