In our last post, we addressed the ongoing issue of China’s abuse of Red Notices against people who owned very successful businesses and against dissidents. Today, we’ll consider a primary goal of certain criminal cases being filed against those individuals: asset seizure.
In China and much of the world, a person’s assets may be seized in association with criminal charges being issued against them. However, in repressive regimes such as China, where improper and abusive charges are not uncommon, arbitrary asset seizure is often associated with people being targeted improperly.
In our practice, we have noted the phenomenon that the Chinese government has generated charges of a financial nature following a person’s dissident speech or a refusal to share a successful business with people in power. In these cases, criminal charges are filed, the individual’s or the company’s assets are seized, and if the person is out of the jurisdiction, a Red Notice is requested.
Such a case may look like the one that was filed against Sun Dawu, a billionaire business owner. In his case, INTERPOL was not involved because he stayed in the country. The underlying facts of the case, however, closely mirror those of several of our clients and provide a representative example of how abusive criminal cases can lead to asset seizure and forfeiture.
After Mr. Dawu spoke out against China’s ruling communist party, the 70-year-old is now serving an 18 years in jail for alleged corruption. Following his detention, Mr. Dawu’s company was placed under new management. A detailed Reuters article by journalist David Lague reports that, in April of 2022, Mr. Dawu’s company was sold to a group set up just three days before a court-ordered auction, as reflected in Chinese corporate filings and court documents. It was sold at a fraction of its true value, according to his family. The impression left is that the Chinese government jailed Mr. Dawu purely for control of his assets.
“Their objective was very clear,” said Yang Bin, a former government prosecutor turned defense lawyer. “They wanted to totally crush his whole business.”
Mr. Dawu stated that some evidence shown at his trial was fabricated, some was exaggerated, and other allegations didn’t involve illegal conduct.
Cases like Mr. Dawu’s illustrate how relatively easy it is for a government to abuse its systems- and if needed, those of INTERPOL- to obtain a desired result. Charges that appear to be legitimate can be used to issue Red Notices and target individuals through INTERPOL.
As always, thoughts and comments are welcomed.
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