Is $44 million worth it to ANZ bank to draw the scrutiny of American regulators?

It’s Thursday afternoon in New South Wales, Australia, where just hours ago, the High Court there (Australia’s equivalent of a federal appeals court) just ruled against Jacksonville-based APR Energy, and in favor of the Australia-New Zealand Bank (ANZ), further solidifying a case of what one Australian parliamentarian referred to as “legalised theft.”

In a long-standing international dispute that FloridaPolitics.com has been following for some time, a Florida business, APR Energy appears to be on the precipice of a $44 million taking by a foreign bank, with the full complicity of the Australian system to do so.

In early 2014 APR leased tens of millions of dollars worth of U.S.-manufactured GE turbines and other equipment to Forge Group Power Pty Ltd, a private utility in Western Australia. Within roughly a month of receiving the equipment, Forge went bankrupt.

As with most leases, APR’s agreement with Forge maintained APR’s exclusive ownership of equipment and power generation facilities. The contract further stipulated that in the case of a breach, or bankruptcy filing by Forge, all leased facilities would be returned immediately to APR in Houston, Texas. ANZ Bank ignored APR’s ownership right, as well as Forge’s contractual obligations (more on that later), and seized APR’s property as their own under the then-recently enacted Personal Property and Securities Act (PPSA).

(In what must be a bitter irony for APR, Australian Parliament recent passed a law to reform the very provision of PPSA under which ANZ seized APR’s power facilities.)

In order to get their power generation facility back, APR was forced to post a $44 million letter of credit in favor of ANZ Bank to get its own property back. Five business days after today’s High Court ruling, ANZ can draw down on that letter of credit, in its entirety.

But new evidence obtained by FloridaPolitics.com clearly points to potential fraud on the part of ANZ Bank, prior to the execution of the original lease in question.

In August 2013 — nearly 6 months prior to Forge’s bankruptcy and ANZ’s subsequent seizure of APR’s equipment — ANZ issued a letter of credit to Forge on the basis of its collateral at the time, and in full knowledge of the lease it had signed with GE International (acquired shortly thereafter by APR); a lease which explicitly said Forge had no property or security rights over the leased equipment.

This smoking gun potentially proves the fraudulent nature of the entire process by which ANZ has held a Florida company financially hostage for more than three years.

And APR is no shrinking violet, fighting for what is rightfully theirs in both the Australian court system and the U.S. political process.

Numerous Senators and members of Congress from Florida and elsewhere — including both Sens. Marco Rubio and Bill Nelson — have weighed in on behalf of APR over the years. But they’ve done so simultaneous to APR’s case winding its way through the Australian civil justice system, and they’ve been respectful of that process.

Now that the Australian courts have spoken, expect that U.S. politicians, too, will speak up clearly, and strongly, on behalf of this U.S. company being robbed in plain daylight by a foreign bank, under a set of newly revealed circumstances that are highly suggestive, if not dispositive of, fraud.

Florida Congressman Dennis Ross recently sent a letter to ANZ’s U.S. executive, Truett Tate, asking for an “explanation of this taking of APR’s … property”, and asking if Tate was willing to meet with the House Committee on Financial Services to answer additional questions on the matter.

That letter, dated April 3 of this year, has yet to receive a response from Tate or ANZ.

Separately, another member of that same committee, Rep. Josh Gottheimer, sent a letter on April 7 to Thomas Curry, the U.S. Comptroller of the Currency (OCC) — the agency responsible for overseeing foreign banks in the United States — requesting his office’s attention to ANZ’s activities. Gottheimer’s letter calls ANZ’s taking a “fraudulent conveyance and transfer of title under U.S. law”, while also reminding Curry of ANZ’s previous sanctions by the U.S. Commodity Futures Trading Commission, and the U.S. Department of Treasury, in relation to ANZ’s business in hostile foreign dictatorships Myanmar, Sudan and Cuba.

Sources from within the House Committee on Financial Services tell us that proposed legislation is already in drafting, and soon to be filed, that would prohibit a financial institution, domestic or foreign, from receiving the proceeds of a fraudulent transfer, such as would occur if and when ANZ drew down on the $44 million credit line with APR. The legislation — modeled after similar laws on the books in 44 states — would also create a private cause of action against the beneficiary of a fraudulent transfer, including the potential for punitive damages. It would also expose the financial institute to disciplinary action by American regulators.

That an Australian court would ultimately rule in favor of an Australian bank in this dispute, was never much in question. Now the question is going to shift rapidly to ANZ Bank, as they consider whether $44 million is worth the ire and scrutiny of U.S. lawmakers, and their potential to make continuing to do business in the United States very, very difficult.