It was supposed to fetch a kingly sum but ended up selling last year at auction for a relative pauper’s price. Now, the Mountain of Beverly Hills is at the center of a new lawsuit seeking to recover more than $100 million in allegedly embezzled funds.
The Justice Department on Thursday filed seven lawsuits in U.S. District Court in Los Angeles seeking the forfeiture of real estate and other assets purchased using funds that the suits contend were embezzled by former officials in Kuwait’s Ministry of Defense.
U.S. prosecutors claim the pilfered funds were used to purchase or contribute to the improvement of the 157-acre Mountain property as well as three homes in Beverly Hills, a private jet, sports cars and Manny Pacquiao boxing memorabilia, among other things. The U.S. is seeking to recover at least $104.38 million in laundered funds.
According to the lawsuits, three high-level Ministry of Defense officials opened six unauthorized bank accounts between 2009 and 2016 and used the accounts to facilitate the transfer of more than $100 million in Kuwaiti public funds to California bank accounts connected to the son of a convicted felon.
The convicted felon is identified in the complaints as Victorino Noval, a Los Angeles-based businessman who was convicted in 2003 of mail fraud and tax evasion and later sentenced to federal prison and to pay $25 million in restitution.
Khaled al-Sabah, who served as Kuwait’s defense minister from 2013 to 2017, last year filed a $163-million lawsuit against a group of California businessmen that includes Noval; Noval’s three sons, Victor Franco, Jake and Hunter; Noval’s ex-wife, Hannah Noval; and his attorney, Ronald Richards.
In an email, Richards said the funds at the center of the dispute were wired almost a decade ago and that the foreign national making the transfer had been verified as a member of the Kuwait royal family.
“My client vetted the person and confirmed his/her stature,” Richards said. “Any improprieties relating to funds wired to the United States would be something that my client would have no way of knowing about nor was it shared with him. My client has no need nor interest in retaining any improperly distributed funds.”
Once listed for $1 billion, the 157-acre hilltop known as the Mountain sold last year at auction for $100,000.
(Beth Coller)
Touted as the city’s finest undeveloped piece of land, the Mountain made international headlines in 2018 when it hit the market with the highest price tag in L.A. real estate history: $1 billion.
While some dubbed the ambitious listing a publicity stunt, the prized piece of land offers more privacy and space than almost any other property in Southern California.
Set at the highest point of the 90210 ZIP Code, it spans 157 acres — or roughly twice the size of Disneyland. It’s spread across 17 parcels, six of which are zoned for residential development. Listing agent Aaron Kirman said at the time that potential buyers he spoke with envisioned everything from an ultra-exclusive enclave of homes to a Huntington Garden-style oasis for a single buyer.
Despite plenty of hype, no buyer materialized, and the price was eventually lowered to $650 million. Developer Scott Gillen reportedly offered $400 million, but the seller turned it down.
At the time, it was owned by Atlanta investor Chip Dickens and his business partner, Victor Franco Noval, through a limited liability company called Secured Capital Partners. They obtained it in 2004 on a $45-million loan from the property’s previous owner, the estate of late Herbalife founder Mark Hughes.
The $45-million debt eventually ballooned to around $200 million, and the company tried and failed to declare bankruptcy last year. As a result, the Mountain was auctioned off at a sparsely attended, unceremonious foreclosure auction behind a fountain in Pomona’s Civic Center Plaza.
Only one bid was placed, and it came from the estate of Hughes for a mere $100,000. In buying back the property, the estate lost out on the roughly $200 million it was owed, but finally regained possession of the prized land after 15 years.