Trustee files to
prevent dismissal
of Sia case

Undisclosed bank stock and
safe-deposit boxes are listed as
reasons behind the move

By Peter Wagner
Star-Bulletin

Undisclosed safe deposit boxes, thousands of unrecorded bank stocks, and millions of dollars in mortgage assets transferred to an offshore company in the Virgin Islands are among new questions raised in the bankruptcy of flamboyant businessman Sukamto Sia.

Guido Giacometti, the trustee overseeing Sia's case, yesterday filed a motion in U.S. Bankruptcy Court against dismissal of the case, alleging Sia has been uncooperative and did not disclose all of his assets.

"The debtor and his affiliates have consistently and in a coordinated fashion refused to cooperate with, and indeed, impeded, material discovery," the trustee said in the new filing.

Sia earlier this month asked the court to dismiss the case, a Chapter 7 liquidation, saying his far-flung creditors would get little satisfaction in the division of his assets in U.S. Bankruptcy Court. He argues his creditors would be better off pursuing individual claims in Asian, European, and American civil courts. The matter is to be heard in bankruptcy court on Oct. 13.

Sia's November bankruptcy filing shows $9.3 million in assets and more than $296 million in debts. The filing came a month after his arrest in Las Vegas for bouncing $13.5 million in checks written to two gambling casinos.

Yesterday's filing disclosed newly found assets that weren't reported in Sia's bankruptcy filings: two safe deposit boxes -- at Bank of Honolulu and Bank of Hawaii -- and 157,964 shares in the Bank of Honolulu. Sia, formerly known as Sukarman Sukamto, is the majority owner of Bank of Honolulu and resigned last year as chairman after his arrest in Las Vegas.

Giacometti on Wednesday disclosed the transfer of $16 million in mortgage interests to a little-known corporation, A-B-C Pacific Ltd., in the Virgin Islands.

According to the new filing, Commerzbank in Singapore is holding 157,964 shares of the bank's stock as collateral on loans to Sia. The trustee believes only 7,964 shares apply to the loans and that the balance of 150,000 shares should be returned to the bankruptcy estate for liquidation.

But investigators for the trustee last week learned that another 157,964 shares are outstanding. Records indicate Sia's stock holdings in the bank doubled shortly before he filed for bankruptcy last year. Citing corporate filings at the state Department of Commerce and Consumer Affairs, the records show Sia's holdings went from 157,964 shares on Sept. 1 to 315,928 on Nov. 3, three days before the Nov. 6 bankruptcy filing.

The bank, which had a total of 158,264 outstanding shares on Sept. 1, on that day authorized an increase to 1 million shares, the trustee's filing says.

Sia's increased holdings in the bank have yet to be located.

"The trustee believes that this stock was issued to the debtor, however the whereabouts of the certificates for the newly issued stock have not yet been disclosed," yesterday's filing says.

Jerrold Guben, Sia's bankruptcy attorney, today said he believes the discrepancies can be explained. "We're going to have an explanation and hopefully set the trustee right about lots of these things," said Guben, who has until Oct. 1 to reply in court. "He might just be interpreting things differently."

Giacometti said Commerzbank is not cooperating with inquiries and that information about the additional shares will be sought via subpoena.

Meanwhile, Societe Generale, a bank in Singapore, this week disclosed it is holding some share certificates in the bank dating to 1996 that it plans to turn over to the trustee. Under federal bankruptcy law, all transfers of assets within a year of a bankruptcy filing must be disclosed.

In a complaint filed Wednesday against A-B-C Pacific, the trustee alleged Sia transferred mortgages valued at $16 million in the Executive Center high rise downtown to the British Virgin Islands corporation in order to defraud creditors. The complaint alleges A-B-C is an "insider" company controlled by officers of Sia's other businesses.

Sia disclaims any interest in A-B-C, Guben said.