The Caribbean Island Where China's "Red Nobility" Parks Its Money

How It Works
Jan. 22 2014 4:03 PM

The Latest Scoop on the Secret Wealth of China's Most Powerful People

Workers' Paradise.

Photo by via Getty Images

The International Consortium of Investigative Journalists has published the results of a multiyear investigation into the offshore holdings of some of the wealthiest people in China:

Joshua Keating Joshua Keating

Joshua Keating is a staff writer at Slate focusing on international affairs and writes the World blog. 

Nearly 22,000 offshore clients with addresses in mainland China and Hong Kong appear in the files obtained by the International Consortium of Investigative Journalists.  Among them are some of China’s most powerful men and women — including at least 15 of China’s richest, members of the National People’s Congress and executives from state-owned companies entangled in corruption scandals.
PricewaterhouseCoopers, UBS and other Western banks and accounting firms play a key role as middlemen in helping Chinese clients set up trusts and companies in the British Virgin Islands, Samoa and other offshore centers usually associated with hidden wealth, the records show. For instance, Swiss financial giant Credit Suisse helped Wen Jiabao’s son create his BVI company while his father was leading the country.

The files include details of the offshore holdings of President Xi Jinping’s brother-in-law, former Premier Wen Jiabao’s son, Tencent founder Ma Huateng, and China’s richest woman, Yang Huiyan. The British Virgin Islands is apparently the “preferred offshore destination for mainland China and Hong Kong residents.” Forty percent of BVI's offshore business now comes from East Asia.

The actual detials of this story seem less interesting than the fact that it was published and the possible fallout from it. It would be a bit surprising if Chinese economic and political elite didn’t keep their money parked in island tax havens, like the economic and political elite of every other country.

But the Chinese Communist Party has also clearly drawn a red line for foreign outlets on reporting on the wealth of senior leaders and their families. It was reporting of this type that got the websites of Bloomberg and the New York Times blocked in mainland China and reportedly led to the suspension of reporter Michael Forsythe.  

According to the ICIJ, “In November, a mainland Chinese news organization that was working with ICIJ to analyze the offshore data withdrew from the reporting partnership, explaining that authorities had warned it not to publish anything about the material.” In the end, the group worked with partners including “the Hong Kong newspaper Ming Pao, the Taiwanese magazine CommonWealth and the German newspaper Süddeutsche Zeitung.”

A visualization of the data produced by the Guardian yesterday has already gotten the British paper blocked in China.

It certainly seems as though Beijing’s strategy of blocking the websites of offending outlets and withholding visas from journalists isn’t having the desired effect of discouraging this kind of reporting. If anything, it seems to be encouraging it.

Correction, Jan. 23, 2013: The image which originally accompanied this post showed the island of Nevis, which is not one of the British Virgin Islands.   

Joshua Keating is a staff writer at Slate focusing on international affairs and writes the World blog. 



Meet the New Bosses

How the Republicans would run the Senate.

The U.S. Is So, So Far Behind Europe on Clean Energy

The Government Is Giving Millions of Dollars in Electric-Car Subsidies to the Wrong Drivers

The Best Thing About the People’s Climate March in NYC

Friends Was the Last Purely Pleasurable Sitcom

The Eye

This Whimsical Driverless Car Imagines Transportation in 2059

Medical Examiner

Did America Get Fat by Drinking Diet Soda?  

A high-profile study points the finger at artificial sweeteners.

A Woman Who Escaped the Extreme Babymaking Christian Fundamentalism of Quiverfull

John Oliver Debunks the Miss America Pageant’s Claim That It Gives Out $45 Million in Scholarships

Trending News Channel
Sept. 20 2014 11:13 AM Watch Flashes of Lightning Created in a Lab  
  News & Politics
Over There
Sept. 22 2014 1:29 PM “That’s Called Jim Crow” Philip Gourevitch on America’s hypocritical interventions in Africa.
Sept. 22 2014 1:37 PM Subprime Loans Are Back! And believe it or not, that’s a good thing.
Lexicon Valley
Sept. 22 2014 1:22 PM Is Arabic Really Just One Language? 
  Double X
The XX Factor
Sept. 22 2014 12:29 PM Escaping the Extreme Christian Fundamentalism of "Quiverfull"
  Slate Plus
Slate Plus
Sept. 22 2014 1:52 PM Tell Us What You Think About Slate Plus Help us improve our new membership program.
Sept. 22 2014 2:12 PM Crusader, Sans Cape The superhero trappings of Gotham are just a clever disguise.
Future Tense
Sept. 22 2014 12:14 PM Family Court Rules That You Can Serve Someone With Legal Papers Over Facebook
  Health & Science
Sept. 22 2014 12:15 PM The Changing Face of Climate Change Will the leaders of the People’s Climate March now lead the movement?
Sports Nut
Sept. 18 2014 11:42 AM Grandmaster Clash One of the most amazing feats in chess history just happened, and no one noticed.