Chinese state-run media are adding credence to speculation that an executive who helps wealthy families move their money to the US was among those jailed last week for illegal currency trading, Xiao Zibang, Allen Wan, Jing Li and Charlie Zhu reported for Bloomberg News.
Photo Insert: Wailian Overseas Consulting Group Inc. is a Shanghai firm that helps rich Chinese citizens acquire visas to Western nations, secure spots for their children in elite foreign schools, and facilitates overseas investments.
Shanghai police said they had detained five people for illegal foreign currency transactions worth some 100 million yuan ($13.8 million), including a woman surnamed He, age 54, who ran an immigration services company.
At least two state media outlets ran stories citing reports that the person detained was He Mei, a Shanghai executive also known as Linda He, the chairwoman and president of the Wailian Overseas Consulting Group Inc., a Shanghai firm that helps rich Chinese citizens acquire visas to Western nations, secure spots for their children in elite foreign schools and facilitates overseas investments.
The case highlights China’s efforts to stop wealthy citizens from moving cash overseas, reflecting the dire state of an economy still reeling from the debacle of the property market and tighter regulations of the private sector.
Capital controls allow citizens to convert $50,000 worth of yuan into foreign currencies each year, making it hard for rich Chinese to move their money abroad.
Capital flight is expected to pick up speed as more people resume travel out of the country. Natixis expects the amount to leave the country to reach $150 billion this year.
Such outflows would put another strain on China’s faltering post-pandemic recovery as the nation slides into deflation, Reuters, the Associated Press (AP) and CNN also reported.
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