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Billionaire Paul Singer, the hedge fund founder seeking to collect on more than $1.5 billion in judgments over Argentina's defaulted bonds, may search the deserts of Nevada for some of that money, a judge has ruled.

Singer asked a federal court in Las Vegas in April to order 123 companies in Nevada to turn over information about assets belonging to Argentine businessman Lazaro Baez, who is accused in that country of embezzling $65 million from government contracts. U.S. Magistrate Judge Cam Ferenbach in Reno granted that request Aug. 11, ruling that Singer's hedge fund was attempting to execute a valid judgment against Argentina.

"There is no doubt that the 123 companies are shell corporations," Ferenbach said in an order. "Similarly, there is no doubt that shell corporations are routinely formed to commit fraud."

Singer's decade-long quest to recoup on investments in Argentina's debt peaked last month when the country went into default for the second time in 13 years after talks broke down with some creditors. Singer leads a group of hedge funds owed more than $1.5 billion from the country's 2001 default. A federal judge in New York barred Argentina from paying on restructured debt until it satisfies Singer's group.

In his order, Ferenbach wrote that Argentina's failure so far to satisfy judgments won by Singer's NML Capital has caused the company to "travel the globe in search of property owned by Argentina."

Jason Wiley, an attorney for the Nevada corporations with Kolesar & Leatham in Las Vegas, called Ferenbach's order "disappointing."

"We believe it to be a misapplication of law and we're examining all potential avenues going forward," Wiley said in a phone interview. Some of the entities are no longer in existence and have been dissolved, he said.

Baez's ties to Argentina and current president Cristina Fernandez de Kirchner are "infamous" and the businessman has amassed a personal fortune with the help of Fernandez and her late husband, former president Nestor Kirchner, NML said in its April request.

Argentina initiated an investigation in April 2013 into Fernandez, Kirchner and Baez over allegations the trio embezzled millions of pesos from public-infrastructure projects and laundered the proceeds and other embezzled funds through Panama and various international shell corporations, NML said in court documents.

In a report last year, the investigation's lead prosecutor found that Baez transferred at least $65 million to a network of shell companies in Nevada, NML said. The company suspects that the 123 corporations from which it's seeking information are the same as those referred to in that report because the entities have documents tying them to a Panamanian law firm known for incorporating shell companies, NML said in court documents.

NML is seeking documents regarding the transfer of property or funds to and from any of the Baez entities since January 2010 and documents produced in connection to any investigation of the businessman, according to court records.

NML is managed by Singer's Elliott Management Corp., a New York-based hedge fund.

The Nevada corporations opposed NML's request, arguing that no relevant records exist and that their representatives were outside the jurisdiction of a U.S. court's subpoena powers.

State and federal laws permit a judgment creditor to pursue information from third parties if that creditor can show a reasonably suspicious relationship between that non-party and a debtor, Ferenbach wrote in his order. NML has met that threshold, he said.

"There is no dispute that Baez embezzled Argentine funds and that an embezzler or 'thief acquires no title to the property which he steals,'" Ferenbach wrote.

While Ferenbach noted that none of the companies physically reside in or regularly conduct business within 100 miles of Las Vegas, he said the court has broad discretion to order a resident corporation to produce documents within that entity's custody or control "no matter where they are located."

"A company cannot purposefully avail itself of the law's benefits by incorporating in this jurisdiction and then excuse itself from the court's subpoena power by abusing the corporate form," Ferenbach wrote.

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