Seems like wealthy people can get away with just about anything right? Well that’s certainly not the case in China where multi millionaire Liu Han and his brother Liu Wei have both been found guilty of mafia-like activities. The government has siezed an estimated $6.4 billion dollars worth of assets tied to Mr. Liu and his crime syndicate.
Liu Brothers face extensive charges
The Liu brothers were both found guilty of serious charges, including organized crime and murder. 36 other members of the Liu Brothers crime syndicate have so far been charged with similar crimes in the wide sweeping case now making its way through Chinese courts.
ADW Capital’s 2020 letter: Long CDON, the future Amazon of the Nordics
ADW Capital Partners was up 119.2% for 2020, compared to a 13.77% gain for the S&P 500, an 11.17% increase for the Russell 2000, and an 8.62% return for the Russell 2000 Value Index. The fund reports an annualized return of 24.63% since its inception in 2005. Q4 2020 hedge fund letters, conferences and more Read More
The Chinese courts also determined that beyond murder and graft, the brothers used government officials to cover up their crimes. Most of the crimes are believed to have taken place in the Sichuan province of China.
Liu Han had made his fortune as a mining tycoon, but it now appears that he used government connections, brute force, kick backs, and other illicit methods to build up his one time mining empire. Apparently, Mr. Liu went as far as having his rivals murdered and ran a de facto crime syndicate in the province.
At least nine people are believe to have been killed by Mr. Liu’s gang, with five of them having been shot. The syndicate has been tied to numerous other crimes and illegal activities. The police have seized grenades, at least a dozen submachine guns, and twenty different pistols from the gang. This is serious cache considering China’s strict weapons laws.
In 2012, Forbes estimated Mr. Liu to be worth nearly $800 million dollars. With the government having seized some $6.4 billion dollars worth of assets from his crime syndicate, however, it appears that Forbes was underestimating his wealth. Of course, it now appears that most of this fortune was illegally amassed.
Brothers linked to high ranking government official
The two brothers are linked to Zhou Yongkang a retired leader of the Communist Party of China. At one point Mr. Zhou was in charge of China’s security forces and also sat on the Politburo Standing Committee, China’s highest decision making body. Mr. Zhou also has large ties to the oil and gas industry, where he started his career as a technician.
While Mr. Zhou has not yet been formally charged, he is under investigation. China has been cracking down heavily on corruption and many high ranking officials are being investigated. The move comes following the conviction of Bo Xilai, once a rising star in the Communist Party who was found guilty last year of corruption and sentenced to life in prison.
Reportedly, as much as $14.5 billion dollars worth of assets have been seized from Zhou’s family and associates. While charges have not yet been filed, they may be forthcoming, especially in light of the Liu Brothers conviction.If Zhou is charged, many believe that it would mark the most serious corruption case in China’s modern history.
Death penalty widely used in China
China is the world’s leading country when it comes to number of people executed per year. Indeed, the death penalty is used to frequently, that the government does not release statistics like other countries. The number of people executed per year, however, is believed to number in the thousands. To put that into perspective, the United States executed 39 people in 2013.
While in many countries wealthy and well-connected people often escape the death penalty and/or stiff prison times, China has shown little tolerance for serious charges. If anything, the government appears to be more intent on making examples out of powerful people who abuse their power, position, and wealth.