Embattled businessman Eric Watson and his associates, Tim Connell and William Gibson. Composite photo / BusinessDesk
New Zealand businessman Tim Connell is trying to get freezing orders lifted after getting caught up in international litigation over alleged fraud involving Eric Watson.
Connell is a former business associate of Watson and a co-defendant, alongside William Gibson, in UK proceedings stemming from allegations
of fraud and claimed losses of about US$100 million (NZ$178.5m).
That underlying case reached NZ this year after the international claimants led by British-based Voltaire Capital Holdings asked the High Court at Auckland to freeze the assets of Gibson and Connell, without notice, on June 22.
Egypt’s Sawaris family control Gemini Group, which claims it was misled about Voltaire’s ownership and control, and that Connell and Gibson helped conceal Watson’s involvement and extract funds from the business.
Application to discharge
Justice Sally Fitzgerald heard an application from Connell to discharge the freezing and ancillary orders, in the High Court at Auckland on Oct 27.
The New Zealand court had required Gibson and Connell to disclose their assets and transactions, but Justice Fitzgerald later suspended Gibson’s disclosure obligations after he challenged the orders.
Lawyer Ben Molloy said Connell’s position differs from Gibson’s, who was once described as Watson’s “right-hand man”, while Connell is a peripheral figure.
He read out an affidavit from Connell to explain why he chose not to defend the England proceedings.
“First I did not have the funds to defend the proceedings, second I believe the allegations are unfounded … ,” Molloy said, quoting Connell.
“His views are it’s unlikely to proceed, and he’d rather not get involved.”
Molloy argued there was no evidence of a risk of assets being dissipated, and Connell’s evidence was that a house sold following the orders had been on the market since 2017.
“This is an $8.6m property … it’s not an easy property to sell.”
The sale proceeds went to pay off loans and fund two property purchases, Molloy said, including $2.8m to ASB, $2.3m for a residential property purchase, and $350,000 to purchase a commercial building.
“It doesn’t reek of nefarious intent to dissipate assets; these are two new property assets.”
Connell also provided evidence of the trusts he is involved in, and Molloy said the trusts’ assets have been identified.
‘Directly involved’
Jenny Cooper, KC, argued for the continuation of freezing orders and made an application for further ancillary disclosure orders on behalf of the applicants.
Cooper described tedious attempts to serve Connell with court orders, including that he allegedly got in his car and exited his driveway to avoid receiving them.
“It’s clear that Mr Connell had noticed that attempts were being made to serve him, and that he had documents, if he read them, that made it very clear there was a freezing order against him. ”
Cooper said that despite this, Connell acknowledged in his affidavit the sale of Hart Dairy shares by three trusts in July 2026, nine days after the box of documents was delivered to him.
Cooper said further ancillary disclosure orders were being sought to protect the applicants’ interests from dissipation.
“Mr Connell has acknowledged in the past he has been a friend and a business associate with Mr Watson,” Cooper said.
Cooper said there was an inference that Connell was to be remunerated, and that he had referred to a gentleman’s agreement with Watson to receive 5% if the FX company was sold.
“He wasn’t simply appointed as director and shareholder; he was directly involved.”
Justice Fitzgerald asked counsel to address why the freezing orders shouldn’t be amended to mirror the English orders as they have been altered there.
Cooper noted Connell has already been barred from defending the proceedings in England because he failed to comply or engage.
“Therefore, in my submission, there’s a stronger basis for the applicants to seek wider orders in New Zealand … because of Mr Connell’s failure to engage with the English proceedings.
“They’re entitled to seek further orders; it’s understandable that their view of the risks had changed … and they would want further orders to safeguard their position.
The decision has been reserved.
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