(Bloomberg) — Hedge fund billionaire John Paulson used a sham buy of a luxurious penthouse residence in Puerto Rico to improperly enrich himself by $10 million on the expense of his household belief, his spouse claims in a swimsuit accusing him of hiding billions of {dollars} in property throughout their divorce.
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Jenica Paulson claimed her husband agreed in 2020 to purchase the residence on the St. Regis Bahia Seaside Resort for an artificially low value of $5.6 million from a 2009 household belief, which owned the property. The penthouse is at present price $15 million, she stated in an up to date grievance, filed in state courtroom in Manhattan Wednesday. The transaction successfully allowed him to take away $10 million from the belief that he wasn’t entitled to, she stated.
John Paulson, 67, has a web price of $5.1 billion, in keeping with the Bloomberg Billionaires Index. In her July 2022 lawsuit, Jenica Paulson accused him of secretly organising a trio of irrevocable trusts, ostensibly to learn their two kids however truly to defend property for himself. She’s asking for a minimum of $1 billion in damages.
The acrimonious break up gives a uncommon glimpse right into a high-profile divorce in New York, the place matrimonial proceedings are usually confidential. John Paulson filed for divorce in September 2021. The couple doesn’t have a prenup. Days later, the New York Submit reported that he was courting 35-year-old dietitian and Instagram influencer Alina De Almeida.
The events within the case had been scheduled Thursday to argue on John Paulson’s request to throw out the swimsuit earlier than a state courtroom however agreed to postpone the listening to in an effort to tackle the allegations within the amended grievance.
James T. Smith, a lawyer for John Paulson, informed the choose that the brand new grievance is “doubling down” on what his shopper claims are flaws within the swimsuit — particularly, that it fails so as to add their kids as obligatory events since they’re beneficiaries to the trusts.
Smith stated the brand new declare and the case could belong in one other courtroom because it alleges misconduct on a part of the trustee, and that Jenica Paulson could not have standing to pursue the declare as a result of she isn’t a beneficiary of the 2009 belief.
Robert S. Cohen, an lawyer for Jenica Paulson, stated the amended grievance was prompted by the lawsuit filed towards John Paulson in Puerto Rico earlier this month, which “received us to look additional into the matter.”
Earlier this month, John Paulson was sued by his longtime enterprise companion in Puerto Rico, who alleges the billionaire made fraudulent claims to persuade him to take a position $17 million in a luxurious vehicle dealership on the island. Paulson denied the claims, calling them “baseless.”
John Paulson hasn’t made any funds on the Puerto Rico penthouse and has racked up lots of of hundreds of {dollars} in unpaid “hospitality prices,” his spouse stated. Along with monetary property, the household has a bountiful portfolio of actual property investments, together with an Aspen, Colorado, ranch previously owned by a Saudi prince and an property within the Hamptons.
In an emailed assertion, John Paulson’s lawyer disputed what he referred to as “quite a few inaccuracies” within the new grievance. “The condominium buy was not a sham buy – Mr. Paulson signed a contract for the complete record value in 2020,” Smith stated. “As a result of he has not but closed on the residence, there are not any unpaid hospitality prices. All required funds, together with the down fee upon signing, have been made. Mr. Paulson additionally paid the complete $7 million for his stake in Autogrupo.”
Paulson Wealth
The Paulsons married in 2000, after first assembly on the Bear Stearns cafeteria, the place she served him and his workers. Most of his wealth was achieved throughout their marriage — he’s greatest identified for betting towards the US housing market forward of the 2008 subprime disaster, making $20 billion for himself and his hedge fund buyers. He turned the fund right into a household workplace in 2020 and was named chairman of Bausch Well being Cos. in 2022.
Within the revised grievance, Jenica Paulson additionally questioned why JPMorgan denied her request to distribute cash to her from a 2006 belief fund that she understood was valued at greater than $1 billion. The financial institution, as trustee, stated it wanted extra info to find out whether or not the request would go away the youngsters “adequately supplied for,” in keeping with the grievance.
However she stated the financial institution’s demand was a pretext as a result of it represented a tiny portion of the belief’s worth. She stated there’s “no potential means” the request would go away the youngsters in need of funds.
The youngsters are the first beneficiaries of the 2006 and 2009 trusts however haven’t obtained funds from both, in keeping with the grievance.
The companion within the Puerto Rico lawsuit, Fahad Ghaffar, is asking for greater than $50 million in damages from Paulson. Ghaffar claims Paulson informed him in February 2022 that he could be investing his cash in a convertible observe that may finally give him 50% possession within the dealership, F40. Ghaffar claims in his lawsuit {that a} Paulson household belief — one of many three at subject within the New York case — had simply purchased the dealership for $103 million.
The case is Paulson v. Paulson, 652358/2022, New York State Supreme Court docket, New York County (Manhattan.)
–With help from Jim Wyss and Felipe Marques.
(Updates with assertion from John Paulson lawyer.)
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