U.S. prosecutors said money misappropriated from the Kuwaiti Ministry of Defense was used to invest in a Beverly Hills, California, property once on the market for $1 billion.
The Justice Department on Thursday filed a forfeiture complaint against the so-called “Mountain,” a 157-acre undeveloped hilltop touted for its sweeping views, and other assets in California. More than $100 million illegally transferred by a former Kuwaiti Minister of Defense was used to invest in and buy the assets, according to the U.S. The minister was only identified in the complaint as “Official 1.”
The “Mountain,” which sold for $100,000 at a foreclosure auction last year, was at the center of earlier legal fights.
Khaled al-Sabah, who was Kuwait’s defense minister from 2013 to 2017, last year filed a $163 million lawsuit against a group of California businessmen, including Victorino Noval. He said they defrauded him by soliciting money to develop the Beverly Hills property but used his money to buy exotic cars, boats and aircraft as well as to support their “lavish” lifestyle.
“My client stands by the claims asserted in the civil action filed in the Los Angeles Superior Court and maintains his claim that he was defrauded by Mr. Noval and his associates,” al-Sabah’s lawyer Bobby Samini said in an emailed statement. “My client denies any wrongdoing whatsoever. Any suggestion that my client was involved in any illegal activity is incorrect. Mr. al-Sabah will continue to pursue his legal claims against Mr. Noval in the civil action.”
Thom Mrozek, a spokesman for the U.S. attorney’s office in Los Angeles, had no immediate comment on the forfeiture lawsuit.
Ronald Richards, an attorney for Noval, didn’t immediately respond to an email seeking comment.
According to the U.S. forfeiture allegations, a group of three Kuwaiti officials, including the one who became minister of defense, set up unauthorized accounts in the name of the country’s Military Attache Office in London. They allegedly funded the accounts with tens of million of dollars, pounds and Euros of public money and used it for their own purposes.
In 2010, the former defense minister joined with the California businessmen to develop the “Mountain,” according to the U.S. He transfered $104 million of the misappropriated Kuwaiti funds to California banks between 2012 and 2015, with some transfers falsely described as for Kuwaiti military purposes, the U.S. said.
Although millions of dollars were used to maintain and improve the Beverly Hills site, the U.S. claims the money was also spent to buy a $6 million penthouse and another $13 million Beverly Hills property, which the Justice Department is also attempting to seize.
– Bloomberg.