David Barber, Wellington – An ethnic-Chinese Indonesian businessman freed by former New Zealand SAS troops was allegedly held captive for five years in a tiny room in a Javanese village, it was reported yesterday.

Businessman Johnson Cornelius Lo was physically and psychological abused by his captors, a gang led by a corrupt police official, the New Zealand Herald reported. He was reportedly in an emaciated condition when freed in November by the squad of eight former SAS troops now working for an Auckland security firm.

The newspaper reported that Mr Lo had been issued with a New Zealand visitor's permit under an Indonesian name different from his Chinese family name and was now recovering in a secret hideaway in Auckland.

It said Mr Lo, who claims to be heir to a huge financial empire built on sugar and Tiger Balm, had been held in solitary confinement in the village about one hour's drive from Yogyakarta.

"Attempts to free up funds to meet a ransom demand are understood to have fallen through because of tight controls on his bank accounts in Indonesia and Hong Kong and prevarication by middlemen," the paper said.

It said executives of Onix International, a security company set up by former members of New Zealand's elite SAS, were guarded about discussing the operation but insisted no firearms were involved and nobody was hurt.