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Chinese tycoon Xiao Jianhua, missing since 2017, sentenced to 13 years

Xiao Jianhua standing in a park in a picture before he went missing in 2017 / afp

He tried behind closed doors in Shanghai for paying bribes and diverting funds, the absence of the businessman was a mystery, although the judicial process confirms that he was in the hands of the regime all this time.

After spending five years missing and being tried behind closed doors, tycoon Xiao Jianhua, one of China’s richest men, has been sentenced to 13 years in prison and his company, the Tomorrow Group, a maximum fine of 55,000 million yuan (8,025 million euros). After a dark judicial process in which the charges did not come to light, the First Intermediate Court in Shanghai found him guilty of illegally embezzling his company’s funds and paying bribes.

“The criminal actions of Xiao Jianhua and the Tomorrow Group have seriously damaged the order of financial management, endangering national economic security and violating the professional integrity of public officials,” the sentence concludes, according to the newspaper ‘South China Morning Post’. In addition to sanctioning his company, the judges imposed a personal fine of 6.5 million yuan (947,000 euros) on the tycoon.

Under the ruling, Xiao and the Tomorrow Group diverted funds and assets from a bank they controlled, Baoshang, worth 148.6 billion yuan (21.683 million euros) from 2004 to 2018. Finally, the Government said the Government intervention in May 2019, after he went bankrupt. Similarly, in July 2020, Chinese regulators expropriated nine other companies from the Tomorrow Group, including insurance companies and stockbrokers.

In addition to this embezzlement, the ruling says that Xiao Jianhua and his company paid bribes to government officials worth 680 million yuan (99 million euros) to avoid tax audits between 2001 and 2021. Interestingly, this includes the last four years in which the tycoon was. missing and, presumably, being held by the Chinese authorities in some secret place.

From finance to mining

Born 50 years ago to a poor rural family in Shandong province, Xiao Jianhua became one of the richest men in China by amassing 5.5 billion euros with his Tomorrow industrial group, which brought together everything from finance to insurance to real estate and mining.

But his star disappeared with the ‘crash’ that shook the Chinese stock market in the summer of 2015, when shares worth 4.6 billion euros were floated and millions of small investors lost their life savings. His main asset until then was his business with the regime’s high-ranking families, which made him a dangerous political weapon.

While other tycoons and stock market regulators were wiped out by the disaster, Xiao Jianhua took refuge in Hong Kong, where he lived in an apartment at the luxurious Four Seasons hotel protected by an Amazonian guard of female bodyguards. He was last seen there on 27 January 2017, when he got into a car at three in the morning with two bodyguards who picked them up at the hotel gates. The next day, his wife reported him missing to the police, but later retracted it.

Although his whereabouts were a mystery, it was clear that he was in the hands of the regime. As reported by the ‘South China Morning Post’ newspaper, he convinced the authorities to cross into mainland China and “help” in two investigations: one into the stock market ‘crack’ and another into corruption among senior officials of the Communist Party.

Something Xiao Jianhua may know a lot about because, according to Caijing magazine, he was a partner of Vice President Zeng Qinghong’s son in the controversial acquisition of state-owned company Shandong Luneng. With a market value of 73,800 million yuan (10,800 million euros), the two bought the company for 3,730 million (546 million euros), but a spokesperson for Xiao Jianhua declared in 2014 that the operation was completely legal, the newspaper gathers.

That same year, ‘The New York Times’ also reported that the tycoon had done business with the sister and brother-in-law of Chinese President Xi Jinping. Responding to the article, his business group admitted that he had bought a block of shares from them in 2013.

In early July, it emerged that he was being tried, but the crimes for which he was prosecuted are unknown. Held behind closed doors, the oral hearing was not even attended by diplomats from the Canadian Embassy, ​​a country from which Xiao Jianhua holds a passport along with another country from China and an official from Antigua and Barbuda. Neither his passports nor his millions nor his alleged contacts with power saved him from the sentence, which reduced his cooperation to “repair the damage”.

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