v2.5.97

Even from jail, China’s former richest man is making deals and funneling money offshore

Prison hasn’t made a poor man of Huang Guangyu, an electronics retail tycoon jailed since 2010 for bribery and insider trading. According to a report by the International Consortium of Investigative Journalists (ICIJ), Huang and his wife have over 30 companies based in the British Virgin Islands. Though owning secret offshore accounts in the BVI isn’t illegal, these accounts are hard to audit and often used as means to evade taxes.

The ICIJ report highlights how entrepreneurs like Huang—as well as political elites and their relatives—have funneled money from China to offshore havens, or at least have links to those havens. The report also details the offshore accounts of other famous Chinese entrepreneurs including real estate developer Yang Huiyan, currently China’s richest woman, Pony Ma, founder of internet giant Tencent, and real estate tycoon Zhang Xin, founder of the real estate firm Soho China.

The downfall of Huang, once a poor village boy who dropped out of high school at the age of 16 and went on to found the giant electronics retail chain Gome, is also one of the country’s most notable reminders of the tenuous position entrepreneurs hold in Chinese society. Huang, charged with illegal transactions and manipulating the share price of two companies, was rumored to have fallen afoul of a group of powerful Chinese officials.

But Huang hasn’t sat back quietly in his cell. In 2011, a year after Huang was sent to prison, one of his firms placed a bid to buy a retired British Navy carrier in hopes of turning it into a shopping mall. (British Navy officials eventually chose not to sell the ship.) He also waged a campaign (paywall), unsuccessfully, in 2010 to put one of his sisters in place as Gome’s chairman. Business isn’t too bad either. Last year, Huang and his family were estimated to have a fortune of 21 billion yuan ($3.3 billion), ranking them China’s 39th wealthiest family and the ninth richest in Beijing.

Top News

Powered by WordPress.com VIP