China Sentences Evergrande Founder to Life in Prison, Fines Company $2.4 Billion
HKFP · 2 SOURCESabout 3 hours ago2 MIN
Summary
A Chinese court on Thursday sentenced Xu Jiayin, founder of the embattled property giant Evergrande Group, to life in prison for crimes including large-scale financial fraud, embezzlement, and bribery. The Shenzhen Intermediate People's Court in Guangdong Province fined the company and its real estate arm a combined 15.82 billion yuan (US$2.4 billion) .
Key Points
- Xu Jiayin, also known as Hui Ka Yan, was sentenced to life imprisonment with all political rights revoked and personal property confiscated
- The court found Evergrande Group and Xu guilty of illegally absorbing public deposits, fundraising fraud, fraudulent issuance of securities, and corporate bribery between 2016 and 2021
- Evergrande Group was fined 8.82 billion yuan (US$1.3 billion) while Evergrande Real Estate Group received a 7 billion yuan fine
- Xu, 67, was once one of China's richest billionaires and a member of the Chinese People's Political Consultative Conference before his downfall
- The company defaulted in 2021 after struggling to repay creditors when Beijing introduced curbs on excessive borrowing and speculation in the property sector
Why It Matters
The harsh sentence signals Beijing's determination to crack down on financial misconduct in the property sector and serves as a warning to other developers who engaged in risky borrowing practices during China's decades-long real estate boom. The verdict also underscores the broader cleanup of China's property market, which has been grappling with a debt crisis that has rippled through the global economy and affected countless homebuyers in Hong Kong who invested in mainland properties .
The harsh sentence signals Beijing's determination to crack down on financial misconduct in the property sector and serves as a warning to other developers who engaged in risky borrowing practices during China's decades-long real estate boom. The verdict also underscores the broader cleanup of China's property market, which has been grappling with a debt crisis that has rippled through the global economy and affected countless homebuyers in Hong Kong who invested in mainland properties .