Dead fugitive's overseas assets to be confiscated

A court in Shandong province announced the confiscation of properties that had a high possibility of being gained illegally by Zhang Zhengxin, a fugitive who died in Australia about five years ago.

The illegal gains include bank savings of more than A$13.2 million ($9.6 million), real estate, land blocks and relevant interests that had all been transferred to Australia under the names of Zhang's wife and daughter, according to the ruling made by the provincial Qingdao Intermediate People's Court on Tuesday.

Also, the court decided to confiscate five companies in which Zhang owns 100 percent of the shares in China, the ruling said.

It is the first case that China applied to a foreign country for preservation of illicit gains before litigation. The illicit gains transferred by Zhang had already been frozen in Australia under the requirement of the court.

Based on a preponderance of evidence, the court said it decided to confiscate the five companies as well as the bank savings, houses, land blocks and relevant interests in Australia.

Zhang was general manager of the Qingdao Huadong Winery. He allegedly took advantage of the work position to embezzle the company's funds alone or with others from 2001 to 2014, it said.

Zhang first used part of the embezzled money to buy shares of the company and another winery corporation in Qingdao, and then he continued to embezzle the two companies' funds to buy their shares, it said.

He was suspected of embezzling more than 360 million yuan ($56 million), and finally obtained 100 percent of the two companies' shares, it added.

During the period, he used some illicit money to register three other companies for the transfer of his illegal gains, and also transferred part of the money to bank accounts of his wife and daughter in Australia to buy real estate and land blocks, it said.

Zhang was found dead in Australia on May 17, 2016 after he fled overseas on Nov 11, 2014, it said. In 2012, when revising the Chinese Criminal Law, the country added a special procedure allowing procuratorates to apply for confiscating illicit gains of suspects or defendants on the run or who are deceased.

The court in Qingdao said it publicly heard the case on Thursday. Three people that were closely related to the case, including Zhang's younger brother and a representative of the Qingdao Beverage Group, attended the trial as well as the announcement of the ruling.

Other involved entities haven't applied to attend the case hearing or have decided to give up the litigation, the court said.