$100-million forfeiture claim puts the Mountain of Beverly Hills back in the spotlight
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 filed seven lawsuits Thursday 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.
For the record:
3:04 p.m. July 17, 2020A previous version of this article said that Khaled al Sabah’s lawsuit also named as defendants Victorino Noval’s attorney, Ronald Richards; Noval’s ex-wife, Hannah; and his son, Jake. That lawsuit was dismissed and a subsequent lawsuit was filed that did not name Richards, Hannah Noval or Jake Noval as defendants.
U.S. prosecutors claim the 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 from 2009 to 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 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 ordered to pay $25 million in restitution.
Khaled al Sabah, a member of Kuwait’s ruling family who served as defense minister from 2013 to 2017, last year filed a $163-million lawsuit against a group of California businessmen that includes Noval and two of Noval’s sons, Victor Franco and Hunter.
In an email, Ronald Richards, an attorney for companies associated with the Novals, said that 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.”
Bobby Samini, a lawyer for Al Sabah, said: “My client stands by the claims asserted in the civil action filed in the Los Angeles Superior Court and maintains his claim that he was defrauded by Mr. Noval and his associates.
“My client denies any wrongdoing whatsoever,” Samini said in the emailed statement. “Any suggestion that my client was involved in any illegal activity is incorrect. Mr. al-Sabah will continue to pursue his legal claims against Mr. Noval in the civil action.”
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.
Although 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 is 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 Gardens-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. The property was obtained by Dickens in 2004 with a $45-million loan from the property’s previous owner, the estate of late Herbalife founder Mark Hughes. Secured Capital Partners and Noval entered the picture around 2010, according to Dickens.
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.
Like many properties in L.A., the Mountain has long had a history with celebrities, moguls and royals.
Princess Shams Pahlavi, the sister of the late shah of Iran, once planned to build a lavish palace on the mountaintop. It was later acquired by talk show host-turned-TV-producer Merv Griffin, who wanted to build a marble-and-limestone mansion on the site.
“We’ll have a helipad, a couple of lakes and a Palladian-style house, like those you see outside Venice [Italy] but with a variation, because we’ll need lots of glass for the views,” Griffin said in a 1987 interview. However, the mansion was never built.
After falling into financial trouble, Griffin sold the mountaintop for more than $8 million in 1997 to Hughes, in a deal that reportedly set a price record at that time for Southern California. Hughes died in 2000 at age 44.
Three other properties alleged to have been purchased with the Kuwaiti funds are currently for sale, according to people not authorized to comment publicly on the matters.
At the Remington building in Westwood, a penthouse owned by a corporate entity that lists Victor Franco Noval as its chief executive is for sale at $14.85 million. The 5,118-square-foot penthouse, which was purchased in 2012 for $6.55 million, is listed on the website for Compass agent Kirman.
On Marilyn Drive in Beverly Hills, a Mediterranean-inspired mansion tied to Victor Franco Noval is for sale at $13.9 million, according to a listing on the website for the Altman Brothers, a team with Douglas Elliman.
The property is also listed separately as a lease for $58,000 a month; Victor Noval of Coldwell Banker Realty is named as the agent of record. Noval also has the listing for a vacant lot on North Alta Drive that carries an asking price of $15.9 million.
