The former property tycoon was jailed after admitting to embezzlement and corporate bribery, bringing a dramatic fall from one of China’s richest men.
You can build the biggest real estate company in the world. You can be worth billions. But when you take money from regular people to build their homes and spend it on something else, the government eventually comes knocking.
A court in Shenzhen just handed down a life sentence to Hui Ka Yan, the founder of Evergrande. They confiscated all his personal property, too. His two sons and other top executives are also heading to prison, facing sentences ranging from nearly two years to 18 years.
The court said Hui and his team “seriously disrupted” the property market and caused massive economic losses. But the real anger on the street is about what they did to regular homebuyers.
The company took millions of dollars in advance from families wanting to buy apartments. Instead of finishing those homes, they used the cash to buy more land and start new projects. That gamble left behind hundreds of half-built concrete shells and angry buyers paying mortgages on homes that do not exist.
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It is a brutal fall from grace. Hui started out poor, raised by his grandmother. He launched Evergrande in 1996 and borrowed heavily to grow fast. At its peak, the company was worth over $50 billion.
But the math stopped working. When Beijing cracked down on real estate debt, Evergrande ran out of cash and collapsed. It turned out they had faked their revenue by a staggering $78 billion. The court also hit his former companies with a $2.35 billion fine.
The company’s stock dropped 99% before getting kicked off the Hong Kong exchange. The mess dragged down the entire Chinese economy. Hui Ka Yan used to own the skyline. Now, he just owns a prison cell.
