Economy

Named, shamed

Bounties issued for bosses

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Li Zhaohui: in happier times

With the speed at which the fortunes of many Chinese tycoons have reversed lately, a new profession may soon flourish: that of bounty hunters who are hired to locate missing company bosses.

Last week a senior court in Shandong’s Qingdao city published a notice, dangling a Rmb10 million ($1.6 million) bounty for anyone who could provide any clues on the whereabouts of Chen Jianming and his “hidden properties”.

Chen is the founder and chairman of San Sheng, a Zhejiang-based conglomerate which, according to Time Weekly, was one of the top 100 real estate developers before filing for bankruptcy in January this year.

As recently as 2018, Forbes put Chen’s net worth at $890 million. His companies are involved in Rmb100 million worth of unpaid debts, the court said, and that’s why the 68 year-old’s photo is now published atop the bounty notice in a look akin to a Wild West ‘wanted’ poster.

Li Zhaohui, who 10 years ago was popularly known as “China’s richest young tycoon”, got the same treatment just a day later. A court in Shanghai put out a similar notice last Wednesday and the bounty was much higher at Rmb21 million, or 10% of the unpaid debts in question. That includes a Rmb100,000 reward for information that could lead to Li being hunted down, which will be paid out three working days after Li is found, the creditors promised.

Now 40 and not quite so young anymore, the Shanxi native was educated in Australia. Li suddenly found himself at the helm of his family business – Haixin Iron and Steel – at the age of 22 after his father was assassinated (see WiC81). According to the 2008 Hurun Rich List, he was then worth Rmb12.5 billion. His fame peaked in 2010 after marrying actress Che Xiao (who had a famous role in the 2008 comedy If You Are The One) and throwing an extravagant wedding ceremony.

Things have gone downhill for Li. He divorced Che two years later, while the Shanghai Daily reported in 2018 that he’d been listed as a laolai debtor – a database of “discredited individuals” – and was barred from going abroad. The wanted notices on Chen and Li have sent social media buzzing. “Li has finished throwing away Rmb10 billion in just 10 years?” was one popular comment making the rounds.

This is precisely the kind of public pressure the Chinese authorities have been trying to invoke as they increasingly resort to using name-and-shame tactics to prevent businessmen from evading their financial obligations. Besides the government’s laolai database (people on this blacklist are barred from travelling on planes or high-speed trains), Chinese courts are also encouraging creditors to put up bounty notices through their official channels. Presumably this is a means to entice debt collectors, who might subcontract to more effective if less legal agents to get results

According to the Chinese Legal Daily, a newspaper controlled by the state’s judiciary, the bounty system was introduced in 2011. It has served as “a golden key”, the newspaper noted, in helping the authorities to tackle debt evasion through the use of the private sector’s “incentives”. It has also been an effective “educational tool” as many of these scary notices were distributed directly to the debtors’ own “WeChat friend circles”. But the process has not proven foolproof. Take Tony Xia, the former owner of British football team Aston Villa (see WiC326), who appeared on an arrest warrant in 2019. In his case a Beijing court offered a Rmb300,000 bounty, but to no avail: Xia is still at large…


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