Duggan, a 55-year-old former United States military pilot and Australian citizen, has spent the past year battling extradition to the US on accusations of unlawfully training Chinese pilots in the early 2010s, which he denies.
His wife Saffrine had listed for sale her acreage on the NSW south coast to raise funds for her husband's mounting legal bills.
She purchased the seven-bedroom homestead in the Saddleback Mountain range in 2014 for $1.15 million.
David Shoebridge questioned if the AFP and attorney-general were just a post box for US authorities.
But the plan hit a snag after federal police applied to enforce a foreign restraining order approved by a US court covering the property.
An urgent first hearing of the case will be heard in the NSW Supreme Court on Tuesday.
Greens Senator David Shoebridge, who has urged the US to release Duggan from custody, where he has been in solitary confinement, expressed outrage at the latest court action linked to the ex-marine.
"How much is enough?" he told AAP on Monday.
"Not only jailing an Australian citizen, husband and father at the request of the US but now trying to strip his family of their assets without any independent investigation by Australian authorities.Â
"The AFP and the AG (attorney-general) need to explain if they made even the most cursory independent investigation before they filed these proceedings, or if they were just a post box for US authorities."
A Duggan family spokesman said the orders were being challenged as they were "obtained relying on material that was false". He declined further comment.
Duggan was arrested at a supermarket car park in central-west NSW in October 2022 after a request from US authorities.
The father-of-six denies breaching US arms export control laws by allegedly providing military training to Chinese pilots through a South African flight school on three occasions in 2010 and 2012 while he was a US citizen.
If convicted, Duggan faces up to 60 years in prison. Australia does not have equivalent laws.
The Australian Federal Police told AAP its application had caused the NSW Supreme Court to register a foreign restraining order made in the United States.
The US order restrained a NSW property.
"As the proceedings in the NSW Supreme Court are ongoing, it is not appropriate to comment further," a spokesperson said.
