#CBC: “Founder of Chinese firm with billions in B.C. belongings will get 18 years for fraud ” #Toronto #Montreal #Calgary #Ottawa #Canada

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A courtroom in Shanghai sentenced the founding father of a Chinese insurance coverage firm that owns in depth belongings in B.C. to 18 years in jail Thursday after he pleaded responsible to fraudulently elevating billions of {dollars} from traders, state media reported.

Shanghai’s No. 1 Intermediate People’s Court additionally ordered the confiscation of 10.5 billion yuan ($1.6 billion) in belongings from Wu Xiaohui, the previous chairman of Anbang Insurance Group.

Anbang controls the biggest retirement and care dwelling supplier within the province via its subsidiary Retirement Concepts, which has 20 places in B.C., two in Alberta and one in Quebec.

The Canadian authorities authorised Anbang’s buy of Retirement Concepts in February 2017. 

It additionally owns the Bentall Centre, Vancouver’s largest workplace advanced, and is believed to personal the Fairmont Vancouver Airport resort.

A majority share of the four-tower Bentall Centre was bought to Anbang for $1 billion in 2016. (Bentall Centre)

Chinese authorities in management

The Chinese authorities seized management of Anbang in February after Wu was detained final 12 months.

UBC political science professor Michael Byers mentioned Anbang all the time had robust hyperlinks to the Chinese authorities and that the way in which occasions have unfolded had been “entirely foreseeable.”

“Anbang bought these assets as a private company, then it got caught up in a criminal trial,” he mentioned. “Now we’ve had those assets confiscated, and now we have the Chinese government in control, even though that would have been blocked had that been the direct path taken.”

The Anbang Insurance Group constructing in Beijing. The Chinese insurer acquired a $9.6-billion bailout from a Chinese government-run fund. (Andy Wong/The Associated Press)

Wu, who based privately owned Anbang in 2004, was accused of deceptive traders and diverting cash for his personal use. 

He initially denied his guilt at his one-day trial, in accordance with an earlier courtroom assertion, however was proven on state TV in March admitting guilt.

Tangled internet

According to Xinhua News Agency, Wu hid his possession of shares in firms managed by Anbang, filed false statements with monetary authorities and lured traders by providing charges of return above that supplied elsewhere.

Much of the enterprise relied on promoting insurance coverage merchandise to lift funding capital.

Xinhua mentioned Wu used greater than 100 firms below his management to handle funds, and authorities later recovered financial institution financial savings, actual property and different belongings. Wu used his place to misappropriate 10 billion yuan ($1.5 billion) in Anbang’s deposits, in accordance with Xinhua’s prolonged report.

In 2014, Anbang paid $2 billion to buy the Waldorf Astoria resort in New York. (Mark Lennihan/The Associated Press)

Last month, Anbang mentioned it was receiving a $9.6 billion bailout from a Chinese government-run fund. That would imply the federal government fund owns 98 per cent of the corporate, wiping out many of the fairness stake as soon as held by Wu and different shareholders.

Global shopping for spree

The firm had engaged in a world asset-buying spree lately, elevating questions on its stability.

Anbang mentioned probably investing in a Manhattan skyscraper owned by the household of U.S. President Donald Trump’s son-in-law and adviser, Jared Kushner. Those talks ended final 12 months with no deal.

The negotiations with Kushner Cos. about 666 Fifth Ave. prompted members of the U.S. Congress to lift ethics considerations.

Anbang is now being run by a committee of officers from China’s insurance coverage regulator, central financial institution and different businesses. They have mentioned its obligations to policyholders and collectors are unaffected.

Over the years, Anbang grew to greater than 30,000 staff with 35 million shoppers. It diversified into life insurance coverage, banking, asset administration, leasing and brokerage providers.

Speculation is rife over attainable gross sales of Anbang’s belongings, which, along with the Waldorf Astoria New York resort — bought for nearly $2 billion — embody Dutch insurer Vivat NV, the San Francisco Westin St. Francis, and lodges, actual property and insurance coverage holdings in Canada, Belgium and South Korea.

With recordsdata from Karin Larsen and Yvette Brend.

Note: “Previously Published on: 2018-05-10 15:21:48, as ‘Founder of Chinese firm with billions in B.C. belongings will get 18 years for fraud

‘ on CBC RADIO-CANADA. Here is a supply hyperlink for the Article’s Image(s) and Content”.

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