China sentenced Chinese-Canadian financier Xiao Jianhua to 13 years in prison and fined his company Tomorrow Holding 55 billion yuan (AU$11.7 billion). since he was arrested in Hong Kong more than five years ago.
According to a ruling by the First Intermediate People’s Court in Shanghai, Xiao was found guilty of illegal receipt of public funds, breach of trust, bribery and illegal use of funds. Xiao used its financial network to offer pooled funds and sell insurance and other investment products, absorbing more than 311.6 billion yuan (AU$66.3 billion) from the public alone, according to the court.
The trial marked Xiao’s first public appearance since 2017, when he was taken from his room at Hong Kong’s Four Seasons Hotel, where he had been staying for several years after fleeing China. The Hurun report of China’s richest people said Xiao, a student leader at the time of the 1989 pro-democracy protests, was part of a fortune estimated at nearly $6 billion before he disappeared.
The probe into Xiao and his financial network, which included more than 40 financial institutions, was part of a broader effort by authorities to root out illicit activity and ensure financial stability as confidence in the $59 trillion financial system erodes.
Chinese regulators took control of nine financial firms linked to Xiao in mid-2020, after taking control of Baoshang Bank Co. – another lender linked to the financier – a year earlier, citing its “serious” credit risks.
The country’s central bank identified Xiao’s investment conglomerate in 2018 as one of several “financial holding companies” that needed scrutiny in terms of its ownership structure, related transactions and funding sources.
President Xi Jinping’s administration places greater importance on controlling financial risks in an economy already facing headwinds from COVID-related lockdowns and a slumping real estate market. Beijing in June claimed victory in its anti-corruption trawl of financial institutions that had investigated or fined dozens of officials in a bid to curb risk and strengthen corporate governance.
https://www.smh.com.au/business/companies/chinese-canadian-tycoon-xiao-jianhua-jailed-for-13-years-fined-11-7-billion-20220819-p5bbcp.html?ref=rss&utm_medium=rss&utm_source=rss_business China tycoon Xiao Jianhua arrested in Hong Kong, fined $11.7 billion