Google – AFP, 22 January 2014
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Relatives
of top Chinese leaders including President Xi Jinping, shown on October 4,
2013, and former premier Wen Jiabao have used offshore tax havens to hide their
wealth,
a mammoth investigation reveals (AFP/File, Mohd Rasfan)
|
Hong Kong —
Relatives of top Chinese leaders including President Xi Jinping and former
premier Wen Jiabao have used offshore tax havens to hide their wealth,
according to a mammoth investigation released Wednesday.
The
International Consortium of Investigative Journalists (ICIJ), citing
information culled from 2.5 million leaked documents, said that Xi's
brother-in-law and Wen's son and son-in-law were among those with offshore
holdings.
It is the
latest revelation to shine a light on the hidden wealth of family members of
China's top officials, a topic considered off-limits by Communist Party
leaders.
 |
China's
former premier Wen Jiabao is
shown at the Great Hall of the People in
Beijing
on May 13, 2012 (POOL/AFP/
File, Petar Kujundzic)
|
The release
came days after Wen reportedly penned a letter to a Hong Kong columnist
proclaiming his "innocence" over previous claims that his family
amassed huge wealth during his decade in power.
The ICIJ
cited nearly 22,000 offshore clients from mainland China and Hong Kong,
including relatives of former president Hu Jintao, former premier Li Peng and
late leader Deng Xiaoping, the man credited with opening up China's economy in
the 1980s.
Also
included were members of China's National People's Congress, heads of
state-owned enterprises and some of the country's wealthiest men and women,
including real estate mogul Zhang Xin; Pony Ma and Zhang Zhidong, co-founders
of Chinese Internet giant Tencent; and Yang Huiyan, China's richest woman.
ICIJ said
that it sent letters to the government officials, wealthy individuals and
others named in its report.
"Their
response in most cases was to not respond, a standard practice in China,"
ICIJ said.
The
confidential files leaked to the organisation also include the names of 16,000
clients from Taiwan.
Ninety
percent of the mainland Chinese clients set up offshore entities in the British
Virgin Islands, often with the help of Western firms such as UBS and
PricewaterhouseCoopers, the investigation said. Seven percent were established
in Samoa, and three percent in other areas.
The British
Virgin Islands was the destination of choice for Xi's brother-in-law Deng
Jiagui, a wealthy real estate developer and investor who married Xi's older
sister in 1996. According to the report, Deng owns a 50 percent stake in a BVI-based
company named Excellence Effort Property Development.
While such
offshore trusts and companies "may not be strictly illegal", they are
often linked to "conflict of interest and covert use of government
power", Minxin Pei, a political science professor at Claremont McKenna
College in California, told the ICIJ.
In 2012,
the New York Times and Bloomberg news agency published investigations into the
vast wealth said to have been amassed by family members of Wen and Xi.
Both news
organisations have since had their websites blocked in China, and authorities
have denounced the reports as an effort to "smear" China's
leadership. The ICIJ website was in turn blocked within China on Wednesday.
In
November, the New York Times found that US bank JPMorgan hired a daughter of
Wen as a consultant, part of a broader strategy that the newspaper said was
aimed at accumulating influence in China by employing relatives of the nation's
leaders.
According
to the Times report, JPMorgan paid a total of $1.8 million to Fullmark
Consultants, a firm set up by Wen's daughter, Wen Ruchun, who also goes by the
alias "Lily Chang".
The files
leaked to ICIJ give further insight into how Wen Runchun was able to obscure
her connection to the firm: Fullmark Consultants was set up in the British
Virgin Islands in 2004 by her husband, who was its sole director and
shareholder until 2006.
The ICIJ
said it collaborated with more than 50 partner organisations across the globe
in sifting through the data, including The Guardian, Le Monde in France and
Hong Kong's Ming Pao newspaper.
 |
Chinese
para-military police march
beneath a portrait of late leader Mao
Zedong beside
Tiananmen Square
in Beijing on December 13, 2013
(AFP/File, Mark Ralston)
|
The
websites of all three were not accessible within China on Wednesday.
Ming Pao on
Saturday quoted Wen as writing in a letter to a columnist: "I have never
been involved and would not get involved in one single deal of abusing my power
for personal gain.
"I
want to walk the last journey in this world well. I came to this world with
bare hands and I want to leave this world clean."
It
headlined its story on the ICIJ revelations on Wen but omitted any reference to
Xi, suggesting a hesitance to examine the family wealth of China's current
leadership.
One of the
ICIJ partners, a mainland Chinese news organisation, withdrew in November after
"authorities had warned it not to publish anything about the
material", the ICIJ report said.
 |
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