NZ Prosecutor Says U.S. May Target Kim DotCom's Wife

By Jeralyn, Section Crime in the News
Posted on Tue Feb 28, 2012 at 08:44:58 PM EST
Tags: Kim DotCom, MegaUpload (all tags)

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It's a big day for Kim DotCom of MegaUpload. At 4:30 pm New Zealand time (1 hour from now) High Court Justice Tim Brewster will issue his decision on the Crown's appeal of Kim DotCom's release on bail. Hopefully, Kim DotCom won't be returning to jail.

A hearing has been going on all day in another division of the High Court on Kim DotCom and his wife Mona's request to unfreeze assets for living expenses. They say their living expenses are $220,000. a month. The Crown Prosecutor, Ann Toohey, who is representing the U.S., objected to the expenditures as excessive.

DotCom is requesting 28,000 a month for legal and living expenses. The amount of $200,000 is for rent at the mansion. Kim DotCom put $6.5 million into renovations at the property, which he will lose if he can't pay the rent.

Toohey also said she was informed yesterday by the FBI that U.S. prosecutors are investigating Mona DotCom and have made some sort of application: [More...]

United States prosecutors were investigating whether Mona Dotcom was involved in the Megaupload website. Mona, who is 7 months pregnant with twinds, was in court yesterday for the bail appeal and today for the asset release hearing. Ms Toohey said she had received a preliminary application from the United States last night, saying "Mrs Dotcom could have been involved in the company.''

... A copy of the preliminary application had been handed to both Justice Judith Potter and Mrs Dotcom's lawyer.

Toohey said she hopes to have more information overnight. So far today, the Virginia docket shows nothing new since Feb. 16. It may be DOJ applied for a seizure warrant of Mona's assets rather than seeking to add her to the criminal case. Seizure warrants would have their own case number and likely be sealed, at least until challenged.

Her argument against the release of funds in part was that the average New Zealander family income is around $6,000 a month. She said DotCom's expenses were excessive. According to New Zealand Business Review, they include:

Living expenditure - $28,000/month
Security costs - $24,000/month (four bodyguards)
Staff costs - $29,000/month (Ms Toohey said "This seems to include nannies, a butler and Mrs Dotcom's personal assistant")
Annual rent for the former Chrisco mansion was $1 million
Mrs Dotcom also sought to have an additional $600,000 released for "maintenance costs" for the property, Ms Toohey said

Toohey also suggested that the family doesn't need tutors because with Mona not currently working, she should be able to assume more child care duties. (Tutors are not child care, and not every mother has the skills to educate or tutor a child.)

DotCom's lawyer told the Court this afternoon MegaUpload has $550,000 in debt. He asked for the release of $74,000 to pay some of the creditors. Toohey responded that orders from the U.S. agreeing to the release were necessary. (Update: She later agreed and the court has released the $74,000.)

All of the asset restraint is occurring before there has been any finding of guilt or that the funds are tainted. An Indictment is just allegations. While the expenditures are excessive to anyone not in that income bracket, it is their money. Shouldn't they be able to spend it as they see fit until it's been determined to be criminal proceeds? The answer in the U.S., unfortunately, is no.

I wonder at what point Toohey and the Crown will decide mutual assistance has its limits and tell the FBI to take a hike. In a video clip of yesterday's bail appeal she told the court she can't "guarantee" Kim DotCom doesn't have more assets than they know about. That's hardly just cause for detention, even in New Zealand. It may just be the clip played, but she seemed less confident in her bail position than at past hearings.

Stay tuned for the bail ruling.

Update: Kim DotCom will remain on bail. The judge in the asset hearing also gave Mona DotCom $20,000 for living expenses for the next three weeks and $12,650 for her medical expenses. She was also granted use of their 2010 Toyota.

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NZ Prosecutor Says U.S. May Target Kim DotCom's Wife | 2 comments (2 topical)

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Interesting mentions about the phone costs. (none / 0) (#1)
by EL seattle on Wed Feb 29, 2012 at 03:32:21 AM EST

According to one of those reports, the Dotcom folks are requesting $1000 a month to cover cellphone bills, and according to other reports, they're also requesting $5000 a month for landline phone costs. That seems to me to be a lot of phone service for a home.

At least one of the early reports of the January 20th NZ mansion raid referred to a "50-strong staff who worked there", and I'm still wondering if maybe some actual Megaupload site work was being done by people who were either working at the mansion, or living there.

In a mansion that size, there may have been a few rooms on the property where they could have set up a pretty big "home office" that wasn't necessarily connected to the part of the mansion where the kids and the nannies and Mrs. Dotcom were at. One way or another, $150 a day for residential landline phone costs sounds pretty unusual to me, even for a mansion.

(Thank you Jeralyn for your continuing coverage of this story, btw. Between the Megaupload case, today's Interpol v. Anonymous v. Interpol conflict, and the Swedish Supreme Court's recent final word on a Pirate Bay case, 2012 is shaping up to be an interesting year on the new frontier.)

: I Suspect the Cost in NZ are Higher (none / 0) (#2)
by ScottW714 on Wed Feb 29, 2012 at 03:27:17 PM EST

...like Hawaii because it's an island, plus the stuff has to be secured now that he is famous. He had/has a body guard, he either needs a lot of security or thinks he does.
Why would they work from the Mansion, there's nothing to even justify writing it. Why would anyone have people working in their house, disguised as staff, for a service that is entirely based on using it remotely ? And the bandwidth involved would be impossible to disguise to the Feds.
All his costs are high, $200,000 grand for rent, he's not using a Tmobile family plan or Comcast cable/phone. The guy is loaded and I suspect every bill is in proportion to his rent and income.
What's the difference, it's his money and he hasn't been convicted of anything, the real issue everyone should be worrying about is what is the US government doing in New Zealand and what special interest is behind it ?