China Ramps Up Pressure on Exiled Critic, Fining His Company $8.7 Billion
By Eva Dou (Wall Street Journal)
Oct. 12, 2018 10:51 a.m. ET
Court decision adds details to accusations against Guo Wengui, currently living in New York
BEIJING—China put further pressure on exiled businessman and
government critic Guo Wengui, with a court slapping
an $8.7 billion fine on his company and punishing several associates who were
involved in the takeover of a securities firm.
The Friday court ruling adds details to some of the
government’s earliest accusations against Mr. Guo, particularly his dealings
with Ma Jian, a long-serving vice minister in the secret police. Mr. Ma’s
detention in 2015 signaled a turn in Mr. Guo’s fortunes. Mr. Guo has remained
overseas since then, issuing accusations of high-level corruption within
China’s ruling elite, which have prompted in return enmity from China’s
leadership.
The court in the northeastern city of Dalian said that Mr.
Ma’s help was instrumental in enabling Mr. Guo to acquire a controlling stake
in China Minzu Securities Co. in 2010. Mr. Ma ordered
state security employees to threaten a rival bidder into backing down, while he
lobbied government regulators to green light the deal, the court statement said.
(A film star, the head of Interpol and one of China's
wealthiest investors have gone missing after apparently falling afoul of the
Communist Party. The message to Chinese citizens is clear: No matter who you
are, the party can get you. Photo composite: Crystal Tai)
Five of Mr. Guo’s associates—an investment consultant, three
Minzu employees, and an employee at one of his other
companies—were found guilty by the court Friday and given fines and suspended
prison sentences. The court also issued a 60 billion yuan ($8.7 billion) fine
on Beijing Zenith Holdings, the company controlled by Mr. Guo. Beijing Zenith’s
operations include real estate, investment management and animation design.
The court said Beijing Zenith netted 11.9 billion yuan in
illegal profits after taking over the securities company, part of which has
been recovered.
Mr. Guo, who currently lives in New York and
also goes by the name Miles Kwok, wasn’t named as a defendant in the
trial, nor was Mr. Ma. Mr. Guo didn’t respond to calls and messages seeking
comment, while Mr. Ma, who is in detention awaiting trial, couldn’t be reached.
A phone operator at Beijing Zenith declined to put through a
request seeking comment, and Minzu Securities didn’t
respond to a request for comment.
The ruling shows how China’s leadership is determined to
further squeeze Mr. Guo. He gathered a large Chinese following on social media
last year with his allegations of corruption among the Communist Party elite,
issued from his lavish New York apartment off Central Park. Though the
intensity of his criticism has lessened this year, his assets remain frozen in
China and Hong Kong.
Government prosecutors and other authorities have accused Mr.
Guo of a range of criminal offenses, from bribery to sexual assault. In April
2017, China’s Foreign Ministry said Interpol issued an international arrest
notice for Mr. Guo. The U.S. has declined China’s requests for his return. Mr.
Guo has denied China’s accusations against him.
Last year a court convicted several executives of one of his
companies of fabricating documents to obtain bank loans and transfer money out
of the country for Mr. Guo.
News of the interactions between Mr. Guo and Mr. Ma, then state
security vice minister, involving Minzu Securities
arose last year, two years after Mr. Ma was detained in a corruption
investigation by the Communist Party’s antigraft agency. A video posted online
in April 2017, and whose provenance hasn’t been verified, showed Mr. Ma
confessing that he wined and dined government regulators to persuade them to
approve Mr. Guo’s takeover of Minzu Securities to go
through.
—Kersten Zhang
contributed to this article.
Write to Eva Dou at
eva.dou@wsj.com