5 Things to Know About China’s Fugitive Problem
1 Funds Are Fleeing
Sweetheart deals, embezzlement and bribery are legacies of China’s enormous wealth creation over the past three decades, and Beijing says it’s been too easy for criminals to abscond overseas with their cash. China now leads the world in the export of illicit funds, with more than $1.25 trillion draining out of the country in the decade to 2012, according to Global Financial Integrity, a Washington-based advocacy group. The Chinese Academy of Social Sciences once estimated China’s economic fugitives number as many as 18,000; Beijing alleges the U.S., Canada and Australia are top destinations.
Experts say corrupt money likely plays at least some role in helping inflate property prices in markets like California and New York. Foreign investment in U.S. property almost doubled to $22 billion in the year to March 2014, with Chinese cash accounting for nearly a quarter of the money foreign buyers spent on U.S. real estate last year, the National Association of Realtors says. Though most of the money is perfectly legitimate, anecdotal reports indicate suspected fraudsters are parking at least some of their money in real estate.
3 New Diplomatic Dance
China’s president wants the U.S. and other countries to help. But the last time the U.S. acted on a Chinese extradition request was in 2004. Sino-U.S. cooperation is usually confined to one-off deals. Some Western politicians are reluctant to extradite suspects back to China because they worry the fugitives won’t get a fair trial or could face execution.
4 Safe Havens Shut Down
Washington does have an interest in cooperating with Beijing on fugitives. It’s pushing its own efforts to stop tax evasion by Americans and halt suspect currency flows, and wants Beijing’s help. The sides are increasingly engaged on the issues. The U.S. also doesn’t want to send signals that it welcomes criminals to seek safe havens.
5 Chinese Footsteps on the Trail
China is also taking steps to win foreign confidence. It has cut back on criminal executions and deemphasized high conviction rates. Beijing is also watching for any legal missteps in hopes Western governments will deport fugitives. Chinese judicial authorities credit the Fox Hunt initiative with bringing 749 fugitive Chinese officials to justice last year. The goal, says Chinese Foreign Minister Wang Yi, is to “cast a wider and tighter net of international anti-corruption coordination so that even the most cunning fox will have nowhere to escape or hide.”
Global Financial Integrity：
China now leads the world in the export of illicit funds, with more than $1.25 trillion draining out of the country in the decade to 2012.