Home detention not taxing

A $550,000 tax fraudster could serve his home detention in the Lower Hutt mansion he bought from the man responsible for the country’s single biggest fraud.

Tao Li, also known as Adam Li or Adam Lee, was this week sentenced to 10 months’ home detention for pocketing cash sales, money laundering and filing false tax returns.

The owner of Jacksons Cafe and Bistro in Petone, Lower Hutt, pleaded guilty to evading more than $550,000 in tax through what Inland Revenue lawyer Graham Tubb described as an ‘‘elaborate web of deceit’’.

‘‘He accumulated significant sums of money which should have gone towards providing services for the benefit of all New Zealanders.’’

Companies Office records listed Li’s address as 105 Woburn Rd, Lower Hutt, which was previously the home of David Ross, who was responsible for a $115 million fraud.

Ross, whose company Ross Asset Management fleeced at least 700 investors, was jailed in 2013 for 10 years and 10 months for running a ponzi scheme.

His $2m family home was among assets sold to recoup the money. Half went to defrauded investors and the rest to Ross’ wife, Jillian.

Li and two others bought the house in early 2014 for $1.77m. The mansion has a swimming pool, seven bedrooms, five bathrooms, and a separate ‘‘cottage’’ sleepout with kitchen.

The IRD described Li’s actions as ‘‘deliberate and cynical’’.

It said yesterday that investigators visiting his home found more than $180,000 in cash, and business records showed he went to great lengths to move funds around.

Tubb said the sentence should send a strong message to those who try to cheat the tax system.

But an IRD spokesman would not comment on where Li would spend his home detention.