The National Court has refused an application by the Ok Tedi Fly River Development Foundation Limited to revoke restraining orders freezing more than K214 million held in three bank accounts amid allegations of misappropriation and dealings involving suspected criminal property.
In a recent decision delivered in Waigani, Justice Susan Berrigan ruled there were reasonable grounds to suspect the funds were linked to offences under the Criminal Code, including misappropriation and dealing with property reasonably suspected of being criminal property.
The case arose from an application by the Acting Public Prosecutor under the Proceeds of Crime Act 2022 seeking to preserve funds held in Credit Bank and Westpac accounts operated by the foundation. The restrained sums included K8.8 million, K15.5 million and nearly K190 million.
The court heard that the funds originated from the Western Province Community Mine Continuation Agreement dividend trust account established to hold Ok Tedi Mining dividends for the benefit of Western Province communities.
Justice Berrigan said investigations revealed large sums were transferred between various accounts without evidence of ministerial approval or compliance with trust conditions requiring the money to fund development projects.
“At the time of the application I was satisfied that there were reasonable grounds to suspect that the monies held in each of the three bank accounts identified above were instruments of the offence of misappropriation,” Justice Berrigan said.
The foundation argued the money lawfully belonged to it following National Court orders in 2018 appointing its trustee of the funds. It also relied on a 2024 criminal case in which several defendants were acquitted over related allegations.
However, Justice Berrigan ruled the earlier criminal decision was not binding in the proceeds of crime proceedings.
“The POCA specifically empowers the Public Prosecutor to bring proceedings seeking confiscation of tainted property both related to and separate from any criminal proceedings,” she said.
The judge also criticised the way millions of kina were moved through multiple accounts and withdrawn through cash transactions, directors’ fees, consultancy payments and allowances.
“In a little over a year, between January 2025 and January 2026, more than K10 million of the balance of the ANZ Trust Account was spent from three different accounts,” the judge observed.
Justice Berrigan further found there was an obvious drafting error in Section 57 of the Proceeds of Crime Act and interpreted the law to ensure the restraining orders remained valid while confiscation proceedings were before the court.
She said courts should use “good sense to remedy the situation” where legislation produces absurd results.
The court ultimately dismissed the foundation’s application, ruling the restraining orders had not lapsed and should remain in force pending further proceedings.
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