Saturday, June 29, 2013
17% of China's billionaires under investigation or arrest
Around 17% of billionaires in China were under investigation, have been arrested or have lost their fortune quickly due to the country's business environment and illegal financial activities.
Although the number of dollar billionaires in the country has swelled rapidly from 15 to 250 over the past six years, they have loss their wealth as fast as they made it. Around 17% are said to be under police investigation or have been arrested because of financial crimes, according to the nationalistic Chinese tabloid Global Times.
Zhou Zhengyi, formerly the country's wealthiest real estate magnate and once named the 11th richest man in China, was arrested and sentenced to 16 years in prison in 2003 for insider trading and sentenced again in 2007 for bribery and forgery. Yuan Baojing, who made billions through trading stocks and futures, was given the death penalty for killing someone who tried to blackmail him.
US magazine the Atlantic said Chinese billionaires often acquire their wealth through personal connections and favors that go beyond rules and regulations, which have also caused some of them lose their fortune in the blink of an eye.
The Chinese government has also sought to curb their accumulation of wealth in order to prevent the country's huge and increasing wealth gap from increasing social unrest, forcing many billionaires to hide their fortunes through false accounting. Such activities have created a gray economy worth US$1.47 trillion a year, according to Wang Xiaolu, deputy director of the National Economic Research Institute and the Atlantic.