China Jails Military Crooks, Censors Panama Papers Implicating Wealthy Elites

Xi Jinping's corruption crackdown is selective, especially when it comes to his relatives

China Jails Military Crooks, Censors Panama Papers Implicating Wealthy Elites China Jails Military Crooks, Censors Panama Papers Implicating Wealthy Elites
This week, China charged retired Gen. Guo Boxiong of accepting untold millions of dollars in bribes. The Defense Ministry announced on April 4 that... China Jails Military Crooks, Censors Panama Papers Implicating Wealthy Elites

This week, China charged retired Gen. Guo Boxiong of accepting untold millions of dollars in bribes. The Defense Ministry announced on April 4 that he’d been turned over to prosecutors after officials concluded a corruption probe.

Chinese Pres. Xi Jinping has made stamping out corruption — particularly in the military — a major part of his platform. Officials formerly considered untouchable have found themselves facing charges, and some have been executed.

But the announcement of charges against Guo come at an interesting time for Xi’s war on corruption. Just a day before officials turned the general over to prosecutors, Chinese censors were scrambling to clamp down on talk about the Panama Papers leak — which have named several well-connected Chinese citizens as conducting shady deals overseas.

Including Xi’s own brother-in-law.


Guo, 74, served as the vice chairman of the Central Military Commission between 2002 and 2012. During the same period he held a seat in the Communist Party Politburo. He was one of the most powerful commanders in the People’s Liberation Army. Currently battling cancer, Guo has been under investigation since last year when the party expelled him over the corruption allegations.

He is accused of widespread graft and granting favors to relatives and members of what Chinese media have called the “Northwest Faction” — military brass who had demonstrated loyalty to the former general.

Corruption in the Chinese military has been a problem for years. There was a time when serving military officers would openly pursue private sector moneymaking ventures and grant favors for business partners. The Communist Party ordered commanders to divest from these enterprises more than a decade ago, but many of these arrangements have persisted in various forms.

Current and former Chinese officers have publicly expressed concerns that the widespread corruption undermines military readiness and could even be the biggest threat the PLA faces — more so than the armed forces of Russia, the United States and India. Last month, the Chinese defense ministry declared that the military must end all paid outside work within the next three years.

Xi’s administration has made the punishment of corrupt officials a public matter, more so than many previous leaders. American authorities have even helped from time to time. The FBI arrested racketeer Shilan Zhao, a Chinese citizen, in the Seattle area last year with help from Chinese officials and are investigating others.

Xi’s public shaming of offenders has made him incredibly popular among the Chinese working class long frustrated with graft and corruption. “Guo Boxiong used his position to provide help for others in promotions or reassignments, and took a massive amount of bribes either directly or via his family,” read the Defense Ministry’s official statement, which was also carried by the Xinhua official news agency.

“Guo Boxiong confessed everything.”

060718-A-7588H-412 Secretary of Defense Donald H. Rumsfeld (second from left) sits down with Vice Chairman of the People's Republic of China Central Military Commission Gen. Guo Boxiong (right) for a bilateral meeting in Rumsfeld's Pentagon office on July 18, 2006. Chairman of the Joint Chiefs of Staff Gen. Peter Pace, U.S. Marine Corps, (left) and Assistant Secretary of Defense for International Security Affairs Peter W. Rodman (fourth from left) joined Rumsfeld in the meeting. DoD photo by Staff Sgt. Gary Hilliard, U.S. Army. (Released)At top — Guo Boxiong meets with then-U.S. Defense Secretary Robert Gates. Above — Guo meeting with then-U.S. Defense Secretary Donald Rumsfeld and Gen. Peter Pace. DoD photos

While Chinese officials are touting Guo’s looming — and likely very public — punishment, they’ve been far less excited about discussing wealthy elites implicated in the Panama Papers leak, including Xi’s relatives.

The Panama Papers reveal the inner workings of Panama-based law firm Mossack Fonseca. A group of more than 100 news organizations around the world — coordinated by the International Consortium of Investigative Journalists — began publishing stories sourced from the treasure trove of documents in April.

The firm helps politicians, businessmen, athletes and celebrities create offshore accounts for untraceable funds. Several of its clients have been shown to be profiting off of drug dealing, gun running and human trafficking. Mossack Fonseca is just one of many similar companies working in this shady industry.

“The files reveal offshore companies linked to the family of China’s top leader, Xi Jinping,” the ICIJ reported. “Family members of at least eight current or former members of China’s Politburo Standing Committee, the country’s main ruling body, have offshore companies arranged though Mossack Fonseca. They include President Xi’s brother-in-law, who set up two British Virgin Islands companies in 2009.”

Xi’s brother-in-law Deng Jiagui married his older sister Qi Qiaoqiao in 1996. Deng has since become a highly successful real estate mogul. In 2012, Bloomberg News reported that Deng and his wife had hundreds of millions of dollars in real estate, shareholdings and other assets.

The Panama Papers also name former Chinese Premier Li Peng’s daughter Li Xiaolin. Once known as China’s “Power Queen,” she’s the former vice president of the state-run power company China Power Investment Corporation, and served as a delegate to the Chinese People’s Political Consultative Conference, an advisory body to the Chinese legislature.

Hong Kong superstar Jackie Chan’s name appeared as well. Chan, though beloved internationally as an action superstar, has become a controversial figure in Hong Kong for his increasingly staunch pro-Communist Party views and suggestions that the central government should have more power to crack down on dissenting voices, especially protesters in Hong Kong.

Chinese Internet users were quick to spot the names among the Panama Papers, and conversation soon exploded online. But since April 4, it appears that hundreds of posts on Chinese social networks such as Weibo and Wechat have been deleted.

The discrepancy exposes inconsistencies in who does — and does not — get publicly shamed in Xi’s corruption crackdown. It remains to be seen if China will investigate any of its citizens named in the Panama Papers.

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