Sunday, January 31, 2021

More Chinese cases target property in B.C., say lawyers


More Chinese cases target 

property in B.C., say lawyers

SAM COOPER Vancouver Sun

China Citic Bank recently won a so-called Mareva injunction from B.C. Supreme Court, prohibiting the sale of four Vancouver-area homes worth $7.2 million. The homes belong to a couple who were alleged to have “fled China” with an unpaid $10-million loan . FREDERIC J. BROWN / PNG

China Citic Bank recently won a so-called Mareva injunction from B.C. Supreme Court, prohibiting the sale of four Vancouver-area homes worth $7.2 million. The homes belong to a couple who were alleged to have “fled China” with an unpaid $10-million loan. 

Lawyers in Vancouver say they are seeing a substantial increase in B.C. court cases filed by Chinese companies seeking to seize real estate assets from Chinese immigrants in B.C.

The Chinese plaintiffs are asking B.C. judges to enforce monetary judgments awarded in Chinese courts. These Chinese rulings typically involve people found in China to have defrauded Chinese banks or business partners and then fled to Canada with the money and invested in real estate here.

The rapid rise in the numbers of Chinese cases in Canada and the U.S. — two preferred destinations, according to the Chinese government, for financial fugitives — has also been recognized by Dan Harris, a Seattle lawyer who advises international law firms on strategies for recovering assets from Chinese defendants.

Such cases have been trickling into B.C. courts for several years, including a 2015 B.C. Supreme Court award of $670 million to the Bank of China against money allegedly laundered through buying multiple homes and setting up bank accounts in Richmond.

But, according to Vancouver lawyer Christine Duhaime, a precedent-setting case in June appears to have opened the flood gates.

Duhaime says that after her client, China Citic Bank, won a so-called Mareva injunction from B.C. Supreme Court, prohibiting the sale of four Vancouver-area homes worth $7.2 million, calls from China poured in. The homes belong to a couple who were alleged to have “fled China” with an unpaid $10-million loan.

Duhaime says she understands this is the first case of a Mareva injunction, also called a freezing order, being won by a Chinese bank in North American courts. Such injunctions prevent assets from being sold before a court can rule on whether they should be used to repay a court award.

Based on the case, Duhaime says she has obtained information from China alleging that “billions of dollars” of bank fraud proceeds are invested in B.C. real estate. She said she could not share the documents for reasons of client privilege.

“The (Citic) Mareva case absolutely increased the interest in China, and caused a number of banks in China to reach out to us and say ‘We have all these cases. Can we do something in B.C., too?'” Duhaime said. “There is lots of cases coming down the pipe, and there is lots of appetite in China from the government, down to the banks, to come to B.C. to enforce judgments.”

In the Citic case, the defendant, Shibiao Yan, a citizen of China, is now seeking to overturn the Mareva injunction. Yan argues Mareva is a “harsh and exceptional remedy that should only be available in the clearest of cases,” according to B.C. legal filings. Yan’s lawyers did not respond to a request for comment on the case.

Duhaime says as the Citic case continues, her law firm is already working on new cases.

“One of our next projects is a Toronto house we are looking at, worth $100 million,” Duhaime said. “A guy went to a bank in China, defrauded them, got a loan and all the money in one day, and moved to Canada and got a mansion. And no one asked any questions, even though he never worked a day in Canada. It’s all the same type of story, where a foreign national doesn’t have a job, but is living in homes in Canada and owes money to a bank in China.”

The house at 2790 Chelsea Close, West Vancouver, that a Chinese company is naming in an effort to collect on a Chinese court award against the homeowners.

The house at 2790 Chelsea Close, West Vancouver, that a Chinese company is naming in an effort to collect on a Chinese court award against the homeowners.

Vancouver lawyer Ross McGowan recently filed a case for the Chinese industrial giant, Lonking. The heavy equipment manufacturer is seeking to collect on a $6-million judgment awarded by a Chinese court against a Chinese couple living in West Vancouver. The B.C. lawsuit, against Xing Fu Zhao and his wife Ren Tao Li, says they are living in a $3.38-million West Vancouver home.

The defendants have responded, alleging that Lonking obtained their judgment through “fraud” in the Chinese court, and that as a major company in China, “Lonking has enormous power and influence,” so that the Chinese court was “biased against the defendants.”

Lonking, a maker of heavy machinery, including these models, is trying to recover a Chinese court award through the B.C. courts.  LONKING HOLDINGS / PNG

Lonking, a maker of heavy machinery, including these models, is trying to recover a Chinese court award through the B.C. courts. 

In an interview, McGowan said that he could not speak specifically about the case. But he told Postmedia that he anticipates a growing wave of legal actions from Chinese citizens seeking to recover debts by targeting B.C. properties.

“What I can say generally is that I’ve seen and I’m anticipating seeing a lot more claims like this,” McGowan said in an interview. “The amount of inflow litigation from China is substantial. I think the Chinese are starting to appreciate there is an opportunity to make recovery on their losses in China … against people who have immigrated to Canada.”

Harris, the Seattle lawyer, said he agrees with the Vancouver lawyers “100 per cent” that cases from China are rapidly increasing.

“There is an influx of these cases because they are in some ways so easy to bring in the U.S. and in Canada,” Harris said. “And, more importantly, they are so easy to collect on, unlike in China, where winning a case is one thing but collecting on the judgment is another.”

Harris said his firm is often approached by Canadian and U.S. lawyers seeking to recover assets from companies and people in China. He advises these lawyers to seek out assets owned by the litigation targets outside China and then take action “in other countries with more effective legal systems for collecting on court judgments or arbitration awards.”

Legal experts and precedent cases say that as global trade increases, North American judges are increasingly willing to enforce commercial case judgments from China, even though Canada and the U.S. do not have treaties with China for reciprocal enforcement of judgments.

While the legal process without such a treaty is more challenging, if Chinese plaintiffs can establish that their court judgments were awarded in China following fair and due process, experts say that B.C. judges will enforce monetary awards. But Chinese defendants can avoid enforcement of Chinese monetary judgments in B.C. courts if they can show fraud or denial of natural justice in the Chinese court process.

The civil claim from plaintiff Lonking Machinery was filed in B.C. Supreme Court on June 23. It says that defendants Xing fu Zhao and Rentao Li, also known as Xing Fu Zhao and Ren Tao Li, are a married couple that “reside or have property within the jurisdiction of this honorable court.”

Lawyer Ross McGowan in front of BC Supreme Court in Vancouver, B.C., Sept. 8, 2016. Ross McGowan is one of the lawyers bringing a case against Chinese citizens who live in B.C. but lost commercial cases in China. These cases against B.C. property are on the increase . ARLEN REDEKOP / PNG

Lawyer Ross McGowan in front of BC Supreme Court in Vancouver, B.C., Sept. 8, 2016. Ross McGowan is one of the lawyers bringing a case against Chinese citizens who live in B.C. but lost commercial cases in China. These cases against B.C. property are on the increase. 

The plaintiff’s claim states that in October of 2013, Lonking sued defendants including Zhao and Li, and Liaoning Mechanical, a company controlled by Zhao, in the People’s Court of Longyan. The Supreme Court claim indicates that Zhao and Li were not in China at that time, and the couple “did not appear for or participate” in the court case.

In July 2014 the Chinese court, in Fujian province, awarded a judgment against Liaoning Mechanical, Zhao and Li for 30.5 million yuan (about $6 million), Lonking’s B.C. Supreme Court claim says.

Lonking says that the defendants have not appealed the Chinese judgment and that, in B.C., the Chinese verdict is “a valid and enforceable judgment and stands as a debt owing by the personal defendants to the plaintiff.” The lawyer for Zhao and Li, Kathleen MacDonald, said her clients did not want to comment. She referred Postmedia to their legal response, filed on Sept. 1.

The response says the couple are permanent residents who arrived in Canada in 2011 as landed immigrants. Title documents say that in 2011, “Ren Tao Li, housewife” purchased the West Vancouver residence named in Lonking’s Supreme Court claim.

Zhao and Li say Liaoning Mechanical was an exclusive wholesaler for Lonking machinery, and after a distribution deal went sour in 2012, Liaoning signed a new deal with Lonking to pay outstanding debts, and has continued to pay back Lonking. The defendants say they were not properly notified of Lonking’s action against them and did not have a fair chance to defend themselves.

Furthermore, the defendants claim they could not have a fair hearing in China, as “Lonking has enormous power and influence,” in Fujian, and in China as a whole, and the company’s president is a member of the elite National People’s Congress, and other political bodies linked to the Chinese state.

“Canadian courts will not enforce a foreign judgment,” that is contrary to Canadian notions of fundamental justice, the defendants stated, and “has been obtained through fraud (and) where the judgment is granted by a foreign court that is biased against the defendants.”

While Lonking’s B.C. claim only names one West Vancouver property, the claim cites various versions of the defendants’ names which are found in connection to a number of B.C. properties or loans, valued at about $11 million.

Xing Fu Zhao and Ren Tao Li are owners of a $2.2-million 100-block Wollny Court home in Anmore, documents show. Xingfu Zhao and Rentao Li are shown as owners of a $639,000 Metrotown condo. On July 12, 2016, Xing Fu Zhao, “retired” and Ren Tao Li “homemaker” of 2790 Chelsea Close in West Vancouver, paid $1.36 million for a home in Maple Ridge, title transfer documents show. The property was assessed at $817,400 in 2016.

Land title and mortgage documents show that Rentao Li, “business person” and Xingfu Zhao, “business person” of 5065 Whiskey Cove Lane in Belcarra, lent $3.6 million in a mortgage to a business person named “Didi Zhao” of 5065 Whiskey Cove Lane.

The mortgage document says the principal amount is $3.6 million, and it does not list any interest rates or payment dates, and says the balance is to be paid at 5065 Whiskey Cove Lane, “on demand.”

In another case, filed in July in B.C. Supreme Court, Beijing Jinxinrun Investment Co. and business person Huimin Li, are seeking enforcement of a 67-million yuan, or about $12.9-million, judgment awarded in a Beijing court in 2015 for defaulted loans. The defendants, Hebei Zhongli Industrial and Trading Group and business persons Ying Min Li and Dong Yan, have not paid the award in China legal filings say, but they are believed to have assets in B.C., according to the plaintiff’s Vancouver lawyer, Junzhong Cao. The plaintiff’s claim indicates no known Canadian addresses for Li and Yan. The defendants have not filed a response to the July 13 claim, and could not be located for comment in China or B.C.

Chinese Officials’ Passports


Regime seeks to halt defections

A Chinese national holds a Chinese Passport on May 16, 2014. Chinese officials are finding the regime tightening down on travel documents for them, in order to keep the officials from fleeing China.

A Chinese national holds a Chinese Passport on May 16, 2014. Chinese officials are finding the regime tightening down on travel documents for them, in order to keep the officials from fleeing China.

In order to curb the stream of unauthorized emigration by Chinese provincial officials and prevent them from leaving the country, Chinese authorities are confiscating their passports.During June, authorities in several Chinese provinces have confiscated local officials’ passports, and many “naked-officials” are being investigated.

In Tieling of Liaoning Province, all officials above deputy section level were required to turn in their passports to the local government. Any official who plans to go abroad will have to first get approval “from above.”

Travel Agencies Notice Business Decline

One immediate consequence of this new policy is that travel agencies are experiencing a drastic decrease in business.

A travel agency in Tieling, who gave her name as Ms. Liu, told the Epoch Times: “All civil servants must have their passports kept by a department in the city government. If he or she wants to go abroad, there must be a good justification. Even when someone wants to travel abroad as a tourist, he has to report to his superiors to be able to obtain permission to get his passport back.”

Ms. Tian, another agent at the same travel agency shared her opinion why the new policy was implemented. “When confiscating the passports, authorities used the excuse of preventing people from using public funds for travelling,” she said. “In fact, they are afraid that the officials may never return to China when having a chance to go abroad. We heard a long time ago that the government might take such action.”

Travel agencies in Tieling have suffered substantial losses, according to Ms. Yang who works at Feiyang Travel Agency. “Starting from the beginning of this year, very few public servants can travel around,” she told Epoch Times.

Mr. Li, a Bureau-level official in Changchun, Jilin Province, told Epoch Times that authorities issued a notice saying officials must report to their superiors to get approval before going abroad, regardless of which country they plan to go to. Local officials are able to keep their passports, though.

A female agent at a travel agency in Changchun confirmed it with Epoch Times, saying, “Officials in Changchun must get approval from above and obtain official stamps from their work unit before they can start the visa application.”

Similar situations of officials being forbidden to go abroad freely exist in many places in China.

A travel agent in Shenzhen, specializing in travels to the United States and European countries, told Epoch Times, it is a nationwide phenomenon that officials are forbidden to go abroad as they please. Even when going abroad as a tourist they have to go through approval procedures. Only publicly sponsored visits to foreign countries are not restricted.

Naked Officials

In the past 20 years, China has seen a rising number of “naked officials,” who have sent their wives, children, and money overseas, and incidents of officials defecting from China. As a result, the Chinese communist regime has attempted to tighten control over its public servants. Starting at the end of 2008, numerous officials have had their travel documents confiscated.

Zhejiang Province demanded that all officials above deputy section level and all officials with the Public Security, the Judiciary, and the Procuratorate turn in to the local governments their passports and exit-entry permits for traveling to and from Hong Kong and Macau.

In September 2011, in Shanghai and the provinces of Guangdong, Jiangsu, Zhejiang, Shandong, and Fujian, local authorities began to hunt down officials who had escaped and took measures to prevent officials from escaping.

Recently, authorities in Guangdong Province uncovered over 1,000 naked officials. But even when threatened with demotion, only 200 were willing to bring their family members back to China.

Sinking Ship

Zhu Xinxin, a former Chinese journalist, now a freelance writer, told the Epoch Times that with the increasing numbers of naked officials and escaping officials, the Chinese communist regime is now panic-stricken. That’s why there is this new policy of confiscating officials’ passports; it’s a mentality driven by fear, Zhu said.

According to Zhu, many Chinese people consider this odd phenomenon an indication of the Party’s end, the struggle before its final demise, and it will come up with any form of madness.

“The Chinese Communist Party is like a sinking ship,” Zhu said. “These officials regard their passports as their lifeboats. Now these lifeboats are controlled; they cannot escape any more. In actuality, the Chinese communist regime wants all these officials to die with it, together,” Zhu said.

Charged With Graft in China

Some Fugitives Are Finding

 Luxury in U.S.

By STEPHANIE SAUL and DAN LEVIN     The New York Times

Even before his name appeared on the “most wanted” list, holes had emerged in the immigrant success story of Wei Chen.

His business partner sued him last year, alleging that nearly $50 million was missing from their development project in Plantation, Fla. The ensuing litigation revealed that Mr. Chen had changed his name from He Yejun, and that he had once been a top executive in a state-owned beer company in China.

When the Chinese government released a list last month of what it described as its leading 100 fugitives accused of economic crimes — including 40 people believed to be hiding in the United States — there was He Yejun’s name, along with that of his wife.

They were accused of misappropriating funds in China before moving to the United States in the late 1990s. Records show that among Mr. Chen’s luxury purchases since immigrating are a $2 million condo near Miami, a Bentley and a 70-foot yacht owned through a corporation.

The highly publicized release of the most-wanted list comes as President Xi Jinping presses an anticorruption crackdown that has already brought down one of the country’s most powerful former officials and sent scores of security agents on a global chase for economic fugitives and their ill-gotten gains.

A photograph, left, provided by China’s Ministry of Public Security, of He Yejun, who is wanted by Chinese authorities for allegedly misappropriating funds, and Wei Chen, right, in a photograph from the Plantation Chamber of Commerce in the U.S.

Last year alone, 680 fugitives suspected of economic crimes were repatriated from 69 countries and regions in the operation known as Fox Hunt, according to the state news agency Xinhua.

This newest phase of the campaign, named Sky Net, was rolled out last month with the publication in Chinese news media of a collection of Interpol alerts that also included one for Yang Xiuzhu, a former deputy mayor of Wenzhou whose stature earned her the top placement on the list.

The United States was identified as the leading destination by the Chinese authorities, with Canada second and New Zealand and Australia tied for third. The four countries do not have extradition treaties with China, partly because of concerns about due process of law, human rights violations and excessive punishment in China.

The Chinese authorities say the reluctance of the four countries to hand over suspects has made them especially attractive havens for suspected economic fugitives.

“Many corrupt officials have chosen to flee to other countries because they can hide themselves behind the complex regulations on extradition and jurisdiction,” Li Zhimin, a spokesman for the Chinese Consulate in New York, said in an email.

Wei Chen's 70-foot yacht, owned through a corporation.

Wei Chen's 70-foot yacht, owned through a corporation.

Whether those on the list are truly China’s most wanted is a question of some debate. Chinese news reports say Beijing has handed Washington a far larger list of about 150 fugitives believed to be in the country.

Ding Xueliang, a Chinese politics expert at Hong Kong University of Science and Technology, said Beijing preferred not to publicly identify some suspects for fear that they or their families might retaliate by leaking party secrets. “The biggest targets are not on this list,” he said. “Some of these people could cause enormous political trouble for the party-state system by revealing what they know.” Indeed, some experts suspect the list is intended more as a warning to those whose identities remain secret than to those now widely known.

A review of the list found a range of figures said to be in the United States — from the relatively high-ranking Ms. Yang to more mundane characters like Qiu Gengmin, a former export agent accused of stealing money from a Norwegian shipping company — but few top officials.

In casting his net abroad, President Xi has made the party vulnerable to a force far beyond its control: the rule of law at the heart of Western legal systems. Even though there is no extradition treaty, American officials point out that Beijing has other options for repatriating suspects — as long as it can provide credible evidence of their crimes.

If American law enforcement agencies can determine that a person is in the country illegally or had lied on an immigration form, he can be deported, though the legal process is time-consuming, and in the case of China, often subject to an evaluation of potential political persecution and the use of torture.

Yang Xiuzhu, a former deputy mayor of Wenzhou whose stature earned her the top placement on the most wanted list . Credit Interpol

Yang Xiuzhu, a former deputy mayor of Wenzhou whose stature earned her the top placement on the most wanted list. Credit Interpol

Yang Xiuzhu reading a newspaper during a meeting in Wenzhou, Zhejiang province. The former deputy mayor of Wenzhou had been in exile for the past 13 years in the US. Photo: Reuters

In a statement, a State Department spokesman, Scott C. Lueders, said the United States welcomed increased law enforcement cooperation with China, within limitations. “The United States does not have an interest in serving as a safe haven for fugitives from any country, including China, and will work within the bounds of existing U.S. law to effectuate removals of such individuals,” he said.

In April, the homeland security secretary, Jeh Johnson, met in Beijing with China’s minister of public security, and both sides agreed to improve mutual cooperation on the repatriation of fugitives and illegal immigrants.

Whatever the precise standing of those on the latest list, China’s state-controlled news media has trumpeted the overall crackdown as proof of the Communist Party’s determination to vanquish corruption and bring Chinese criminals to justice — no matter where they are hiding. Western analysts, and not a few ordinary Chinese, also view the campaign through the prism of factional politics, as a cudgel to sideline rivals as Mr. Xi seeks to consolidate power.

The zeal with which Mr. Xi and his allies have pursued corrupt officials has sent shock waves through long-untouchable institutions such as the military and the Politburo Standing Committee. Last month, the nation’s former domestic security chief, a retired standing committee member, Zhou Yongkang, was formally charged with taking bribes, making him the highest-ranking party official ever to face corruption charges.

Even so, Steve Tsang, a senior fellow at the University of Nottingham’s China Policy Institute, says there are limits to how far Mr. Xi can go in confronting corruption at the apex of Chinese power, prompting him to take his campaign overseas. “Xi still has to do something that captures the imagination, so he’s gone from hunting tigers to hunting foxes,” he said

An aerial view of Mr. Chen’s condo in Aventura, Fla. 

An aerial view of Mr. Chen’s condo in Aventura, Fla. 

Within the Chinese community in the United States, there is skepticism. “Among the people on the list, there are some bad guys,” said Ning Ye, a lawyer in Flushing, Queens, for Mr. Qiu. “But there are also some falsified cases.”

The allegations against Mr. Qiu, 53, arose from his business dealings with I.M. Skaugen Marine Services, a shipping company with headquarters in Norway, which had contracted with a Chinese company to build three oceangoing tankers. Mr. Qiu’s company, Zhejiang Changda Import and Export, was hired as an import-export agent to handle customs formalities, including a value added tax, which would be collected, then refunded, once the ships were exported.

But in 2010, he was accused of keeping a $3.7 million tax refund.

Mr. Qiu fled to the United States, where federal prosecutors last year charged him with attempting to launder the money using several bank accounts established in the names of shell companies to purchase real estate, including a beachfront motel in Myrtle Beach, S.C., registered in the name Travel home 1405 LLC.

The use of shell companies to obscure ownership was examined in a recent series of articles in The New York Times that found an increasing use of hidden ownership by foreign citizens purchasing high-end real estate in the United States.

Mr. Ye argued that Mr. Qiu was the subject of Chinese retaliation because of involvement in a pro-democracy movement. Mr. Qiu, who is being held in the Monmouth County Correctional Institution in New Jersey, has filed for political asylum.

Qiu Gengmin, a former export agent accused of taking money from a Norwegian shipping company.  Credit Interpol

Qiu Gengmin, a former export agent accused of taking money from a Norwegian shipping company. Credit Interpol

Transactions that obscured ownership also appear to have been used by Ms. Yang, 67, the former deputy mayor of Wenzhou. She is alleged to have taken bribes of about $30 million while in office.

In 1996, while Ms. Yang was still a municipal official, a corporation called New York International I/E Trading purchased the building at 102 West 29th Street for an undisclosed amount. Within months, ownership had been transferred into Ms. Yang’s name.

In 2004, when a property manager for Ms. Yang tried to evict a tenant from the West 29th Street property, the tenant filed documents in State Supreme Court saying Ms. Yang was a Chinese fugitive. At about the same time, Ms. Yang transferred the building to a woman in Bay-side, Queens, who appears to be her sister-in-law, for $550,000. That same year, it was sold to an apparently unaffiliated group for $2.4 million.

Ms. Yang’s whereabouts is not known; published reports in China have said that she has been apprehended in the Netherlands, but the Chinese Consulate would neither confirm nor deny that.

The presence of Chinese fugitives in the United States raises questions about how they were admitted to the country in the first place. There is evidence that several may have lied to the immigration authorities.

Qiao Jianjun, 51, is accused in China of embezzling nearly $4 million from a large state-owned grain warehouse.  Credit Interpol

Qiao Jianjun, 51, is accused in China of embezzling nearly $4 million from a large state-owned grain warehouse. Credit Interpol

Qiao Jianjun, 51, who is No. 3 on the fugitive list, is accused in China of embezzling nearly $4 million from the large state-owned grain warehouse he ran in Zhoukou from 1998 to 2011. A federal indictment in Los Angeles last year alleged that Mr. Qiao, and his ex-wife, Zhao Shilan, who is not on the list, lied about their marital status and source of funds to obtain a visa under a program that provides a special path to citizenship for those who invest $500,000. The couple purchased a home near Seattle through a shell company. Mr. Qiao remains at large.

A Justice Department spokesman, Peter Carr, cited the California indictment as an example of how the agency “has repeatedly shown that it will vigorously pursue prosecutions” involving charges of money laundering or other criminal activity by fugitives sought by China.

Ms. Zhao is expected to enter a plea of not guilty on Monday, according to her lawyer, Kirk Davis of Seattle, who added, “We don’t have a high degree of trust that the evidence is reliable and accurate because of the nature of the regime in China.”

In Florida, the citizenship application of Mr. Chen’s wife, Huang Hong, 48, known as Linda, was denied after immigration officials accused her of arranging a sham marriage to another man to secure citizenship.

In China, Mr. Chen — then known as He Yejun — had once been among 30 finalists for selection as “Top 10 Industrious Chinese Youths.” He was credited with helping to salvage a tottering fertilizer plant in Hebei Province and to transform it into the Haomen Group, a state-owned beer company listed as one of China’s 500 most profitable enterprises. Mr. He was both party secretary and general manager, according to the list.

In 1999, he fled to the United States, seemingly on the heels of Ms. Huang, an accountant for Haomen’s Beijing office before leaving in 1998. The government put both of them on a wanted list, accused of misappropriation.

An earlier episode in the United States might have foreshadowed his fall from grace. During congressional testimony in the 1996 scandal known as China gate — in which the Justice Department investigated whether China had attempted to influence the Democratic Party through campaign contributions — it was alleged that Mr. He had asked another man to deliver a bag of cash to an American official to obtain visas for Chinese citizens.

It is unclear how Mr. He obtained his own citizenship, but court records show that he changed his name to Chen at the same time. By last year, after his business partner charged that he had misappropriated money from the redevelopment of the Plantation Fashion Mall, the project was placed in bankruptcy and its assets sold off. Phone messages left for him were not returned.

Corruption Couple in Guangdong 

Province Sentenced

This was one of the very first extraditions China ever completed more then 15 years ago.......

Chen Manxiongand his wife Chen Qiuyuan received lengthy prison terms for embezzling 400 million yuan (US$49 million). Husband and wife embezzlers in Guangdong Province have been handed lengthy prison sentences for stealing public funds.

Chen Manxiong received life while his wife, Chen Qiuyuan, was given a 14-year sentence by Guangdong Higher People's Court on Tuesday. The Chens were found guilty of corruption valued at more than 400 million yuan (US$49 million). Appearing in court on Tuesday, both denied the charges against them.

Chen Manxiong, 45, was a manager at Zhongshan Industrial Development Co Ltd. His wife, 43, was the company's lawyer. The sentence came after an appeal to a higher court against an initial judgment given by Zhongshan Intermediate People's Court at the end of last year.

While appearing to be a successful couple, the Chens were fanatical gamblers and lost large amounts of public funds at casinos in the Macao Special Administrative Region. To repay gambling debts, the couple conspired with two officials at the Zhongshan Branch of Bank of China to secure fraudulent loans worth over 400 million yuan (US$49 million) between 1993 and 1995.

The case is believed to be one of the biggest corruption cases ever to have struck the Chinese mainland. The Chens fled to Thailand in June 1995 before the scandal was exposed. Following the discovery, Guangdong police jailed the two bank officials.

In Thailand, the couple changed their names, bought illegal Thai passports, and settled in Chiang Mai where they purchased several properties. Chen Manxiong even had plastic surgery to change his appearance. The couple were detained by Thai police on allegations of illegal immigration and using fake passports in 2000.

Thai authorities sentenced the pair to jail terms of more than 10 years each, before they were extradited to China in December 2002. According to the extradition agreement between China and Thailand, the Chens will be returned to Thailand next month to continue their original sentences for illegal immigration and using fake passports.

(China Daily November 17, 2003)