Former Anbang chairman Wu Xiaohui jailed for 18 years in 65 billion yuan fraud case
Not too bad for a man convicted in the biggest fundraising fraud case in Chinese history
Wu Xiaohui, the flashy, well-connected former chairman of the shadowy Chinese insurance giant Anbang has been sentenced to 18 years behind bars for fundraising fraud and embezzlement of corporate funds on a truly massive scale.
On Thursday, the Shanghai Municipal №1 Intermediate People’s Court announced that Wu had been found guilty of fraudulently raising 65.2 billion yuan ($10.2 billion) through various nefarious methods including regularly falsifying numbers, faking documents, and flouting regulatory rules.
In addition, Wu was found to have taken 10.5 billion yuan ($1.6 billion) from those illegal sales and transferred that money to his own shell companies without documenting the transactions.
For his crimes, Wu was sentenced by the court to 18 years in prison — not too bad for a man convicted in the biggest fundraising fraud case in Chinese history. He was also deprived of his political rights for four years and had his ill-gotten gains confiscated.
Last June, Anbang announced that Wu had stepped aside, explaining that he was “unable to perform his duties,” citing unspecified personal reasons amid reports that the dynamic, high-flying chairman had been taken away by authorities after being barred from leaving the country.
Wu’s detainment came at the front-end of a government crackdown against excessive risk and debt with Beijing forcibly steering privately-owned Chinese conglomerates away from investing too heavily abroad.
Prior to Wu’s arrest, Anbang had been on a prolific global spending spree, snapping up high-profile acquisitions around the globe, raising a number of eyebrows and national security concerns along the way. The company’s biggest acquisition came in 2014 when it purchased New York’s historic Waldorf Astoria hotel for nearly $2 billion.
Last year, Anbang was even close to investing $4 billion into Kushner Companies’ flagship, failing, Fifth Avenue skyscraper. However, that deal was called off after being exposed by the press, drawing unwelcome attention to both sides.
After all, Anbang has become infamous for its opaque shareholding structure, with murky ties to the families of top Chinese leaders. The New York Times discovered in 2016 that the Chinese conglomerate was owned through 39 different companies, many of which turned out to be shell companies that were traced to Wu and his wife, the granddaughter of former paramount leader Deng Xiaoping, as well as to the son of a top military marshal.
In February, China’s government announced that it had seized control of Anbang, which claims 1.97 trillion yuan ($310 billion) in assets, an arrangement which will continue for at least a year. The following month, Wu was put on trial in Shanghai.
At the trial, Wu reportedly objected to all of the charges made against him, claiming that he doesn’t understand anything about the law and did not know which laws he had violated. Apparently, this defense didn’t exactly work for him.
