Canadian Prime Minister Stephen Harper has just wrapped up a four-day visit to China, during which he sat down with the country’s leaders and signed a number of agreements, including one on climate change. But there was one topic he would have preferred to avoid but which inevitably cropped up - the extradition of Lai Changxing, the country’s most famous fugitive.
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Fugitive running out of options
Canada’s extradition of criminals is turning up the heat on China’s most wanted man
Mark O’Neill
06 December 2009
Canadian Prime Minister Stephen Harper has just wrapped up a four-day visit to China, during which he sat down with the country’s leaders and signed a number of agreements, including one on climate change. But there was one topic he would have preferred to avoid but which inevitably cropped up - the extradition of Lai Changxing, the country’s most famous fugitive.
In the summer of 1999, Lai, the “smuggling king”, was tipped off that police were on their way to arrest him at his office in Xiamen and took the next plane out of China. He entered Canada and lives in Vancouver, where he has been successfully fighting extradition for more than 10 years.
Harper’s Conservative government has made relations with China one of its priorities. China is Canada’s second-largest import market and fourth largest export market. Ottawa would love to send Lai back. But there is no extradition treaty between the two countries and the government must go through the immigration process.
Lai has survived so long thanks to an excellent legal team led by David Matas, one of Canada’s top human rights lawyers and one of the co-authors of a report that accuses the Chinese government of systematically harvesting organs from Falun Gong practitioners.
Lai has no passport, since the Hong Kong government in 2002 revoked the passport he used to enter Canada, saying that he had obtained it dishonestly. He has repeatedly been denied political refugee status, most recently in September 2005 by the Supreme Court in Ottawa.
According to Matas, his current legal status is “pre-removal risk assessment applicant”. This means that he has applied to the government for an assessment of whether he and his family would be at risk if they returned to China. Currently, he cannot be deported.
Lai argues that Communist Party influences in the judicial system make it doubtful he will receive a fair trial. “He is also concerned about torture and cruel treatment on return,” Matas said.
Lai is also sceptical of a Chinese promise, made by its ambassador in Ottawa, that he would not face the death penalty if he returned. Matas said the Chinese government had made no offers to Lai on the terms of his return. In February this year, Lai was granted a work permit and works as a consultant to a property company.
He lives alone in a 1,076 sq ft apartment in Burnaby, a well-heeled suburb of Vancouver. Despite living in Canada for 10 years, he speaks little English and has limited contact with the outside world. He spends a lot of time surfing on the internet.
Li Yunlong, a professional in the international strategy department of the Central Party School in Beijing, said the international financial crisis had made Canada aware of its reliance on the US economy and the need to improve relations with China. Since October, several members of Harper’s cabinet had visited China, while Canadian trade and federal organisations had set up offices in China, the Southern Metropolitan Daily on Thursday quoted him as saying.
During Harper’s trip, Foreign Ministry spokesman Qin Gang called on Canada to deport Lai. “We have called for the Canadian government to repatriate him,” he said on Thursday.
Beijing has been moving on other fronts to accelerate the return of Lai, whom it accuses of running the largest smuggling ring in China’s history, involving US$10 billion.
On September 22, a court in Beijing reduced the sentence of the first Chinese economic criminal sent back from Canada from life to 15 years in prison. “His removal from Canada underscores this government’s commitment that our country will not be a safe haven for fugitives,” Minister of Public Safety Stockwell Day said.
Deng Xinzhi, 47, fled to Canada after stealing 24 million yuan (HK$27 million). Escorted by Canadian border officials, he was turned over to the Chinese police on August 22, 2008, after giving himself up.
On October 21 the Canadian police sent back a second fugitive, Liu Xiaoquan, accused of defrauding a client of 400,000 yuan. “The repatriation of Liu shows the determination and active attitude of the Chinese and Canadian police to uphold the law and safeguard justice,” China’s Ministry of Public Security said.
Putting Lai on trial would be an enormous victory for China’s judicial system and a warning to thousands of others who have fled with public money.
Beijing gained another bargaining chip in May, when Lai’s former wife, Zeng Mingna, returned home with their daughter. Their two sons are in Canada, where they have graduated from university. Zeng is living a normal life, with no charges against her. Lai retains good relations with her despite the divorce.
Thousands of Chinese, most of them civil servants and managers of state firms, have fled abroad, taking billions of dollars in public money. Most live in the United States, Canada and Australia, countries with strong legal protection for the individual and no extradition treaty with China. One reason for the lack of a treaty is that these countries do not execute people for economic crimes, while Beijing does.
Chinese lawyers see Deng Xinzhi as a test case for a possible trial of Lai - he was not given the death sentence and his initial sentence was reduced on appeal. His story has some similarities to that of Lai.
The son of a high official, he worked for an insurance company in Beijing. During eight months in 2002, he defrauded two clients of 24 million yuan. In 2003, he and an associate fled to New Zealand. Later they entered Canada on tourist visas and settled in Toronto. Deng applied for refugee status - as Lai did - which would enable him to stay permanently.
Initially, he stayed with his associate and then moved to live on his own. Life was lonely and miserable. With poor English, he could only find work delivering goods in a truck, earning C$2,000 (HK$17,700) a month, which covered his basic needs.
At the end of 2004, a judge told them that they could apply for refugee status, which they did. In June last year the Immigration Department informed him it had rejected his application and would send him back to China.
He turned himself in and, on August 22 that year, was sent back to Beijing in the company of Canadian border officials. He told police that two factors had pushed him to give up the fight - he had run out of money to pay lawyers and he sorely missed his family in China. After his flight, his wife divorced him. His only relatives were two elder sisters and his parents, in their 80s, both in poor health. He told police that he felt great remorse for his crime and for leaving his parents.
In June this year, a Beijing court sentenced him to life imprisonment, which it judged commensurate with the size of his fraud. He appealed; in September, a higher court reduced this to 15 years, on the grounds that he had not appealed against the decision of the Canadian authorities and handed himself in. His lawyer said that such a reduction would help to persuade other fugitives abroad to return.
Another parallel can be drawn with the case of Xu Zhendong, the manager of the Kaiping branch of the Bank of China, who with three associates embezzled US$485 million from the bank. He fled to the US in October 2001.
He was sentenced to 12 years by a Las Vegas court for money-laundering, immigration fraud and entering the US with forged documents. He made an agreement under which he returned to China in 2004 to serve his sentence and escape the death penalty, in exchange for his wife and three children being allowed to remain in the US.
Lai declined to be interviewed for this article. In interviews with the Chinese-language media in August, he restated his determination to stay in Canada, saying that the good treatment given to his former wife could be a “bait” to persuade him to go back. Asked how much money he had left and how he paid his substantial legal fees, he declined to comment.
Lai is one of seven children of a poor farming family from Jinjiang county, Fujian province . He had three years of schooling; then he went to work on the family farm, before going into business. He started with shoes, then umbrellas, electrical appliances, gift certificates for duty-free shops and, finally, a large-scale smuggling racket that involved cars, steel, chemicals and cigarettes.
He has four brothers, of whom two were involved in the smuggling business. One, Lai Changtu, left prison in October 2008 after serving an eight-year sentence, while another died in prison three months before his release. Changtu now lives alone in the spacious two-storey family home.
Lai Changxing’s house is several times larger and lavishly decorated. A cleaner employed by the family keeps the home in good condition.
Lai’s number one enemy is former premier Zhu Rongji, who said that he deserved to die - not once, but several times. This is because Lai’s smuggling not only affected the national economy and budgetary income but also involved dozens of high officials who were on his payroll. During the spring festival in 1999, when Zhu was in Xiamen, he offered Lai a deal - the payment of 1 billion yuan in back taxes and an amnesty if he gave up the smuggling.
Confident of his backing at the highest levels of government in Beijing, Lai refused the deal. In August 1999, on a plane returning to Xiamen, he was tipped off by a senior police officer that a team had gone to his office to arrest him. He did not enter immigration and took the next plane out, enabling him to escape.
The authorities found the “Red House”, a pleasure house in Xiamen, where Lai entertained high officials with the best food and drink, and beautiful women chosen to please them. So Zhu regarded Lai as not merely a smuggler who had disturbed the economy but a germ that had poisoned the governments of Fujian and Beijing.
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