A man who was jailed after concocting an elaborate $6 million property scam to defraud overseas investors has been granted a year to get his affairs in order before he’s deported back to China.
He and his female co-offender pleaded guilty to a raft of dishonesty charges in 2021 after they were found to have defrauded a wealthy couple by convincing them to buy part of an Auckland property development.
The man was served a deportation notice from Immigration New Zealand shortly before he was released from prison on parole in May last year. Since then he has fought to remain in the country by filing an appeal with the Immigration and Protection Tribunal (IPT).
In a recently released ruling, the tribunal declined his appeal but granted him a one-year visa to get his affairs in order and to pay the remaining $640,000 he still owes his victim.
NZME has not published the man’s name to protect the privacy of his young child.
However, he told NZME in an emailed statement that his mistakes “have not only harmed society and victims but have also had irreparable effects on my family”.
“Regarding the recent decision by the IPT, my family and I are deeply disappointed. This outcome has added to the challenges we are already facing,” he said.
“I am currently dedicated to rebuilding my life, repairing relationships with my family, and diligently working to move forward. I have severed ties with past acquaintances to focus on positive changes.”
According to the tribunal decision and court documents, the man’s scam involved a proposed investment property in an Auckland suburb.
An overseas investor was told he needed to invest certain sums of money to purchase the property, while the man and his co-offender also told him others were contributing towards the investment.
But they misrepresented the amounts required and no others were offering any funds.
The fraud, court documents show, included the use of a $10m loan agreement with forged signatures and numerous emails containing false invoices to help obtain the investor’s funds.
Phony invoices for the development were also generated as coming from law firms, a geotechnical company and an engineering and design consultancy as well as a forged Land Information New Zealand (Linz) title document.
The investor said in a victim impact statement he became suspicious about the arrangement and had his accountant examine the accounts, leading to the discovery of a multimillion-dollar shortfall.
The total sum of the fraud, the court heard, was $8m but the investor was deceived into paying about $6m.
Since then, the man has repaid $1.32m to his victims.
Both offenders served just shy of three years in jail after they pleaded guilty to charges of theft by a person in a special relationship, obtaining by deception, using a forged document, false accounting, and dishonestly using a document.
Because the man committed an imprisonable offence within five years of becoming a resident of New Zealand, he voided the terms of his visa and became liable for deportation.
However, the tribunal has the power to overrule Immigration New Zealand when there are exceptional circumstances of a humanitarian nature.
His claim to the tribunal was that since his offending, his life has been ruined and he has lost his savings, reputation, marriage and his freedom.
While now separated from his wife, he still helps service her mortgage, provides for his daughter and is looking after his elderly parents, who are also in New Zealand.
“His deportation would deprive his young daughter of his fatherly care and support and the enjoyment of a normal life,” his lawyer, Roger Chambers, said in submissions to the tribunal.
“The appellant’s elderly parents are permanent residents of New Zealand. They are unable to return to China as they have no property or assets there and are in poor health. The appellant is their only son and, if deported, he would be unable to support and care for them in their old age.”
Chambers said that deportation would expose his client to loneliness and depression as a result of forcible separation from his family and would be “unduly harsh”.
“The appellant has accepted his role in what was ‘rather comprehensive’ offending and put right the wrongs that he was involved in,” Chambers said.
Rhys Boyd, counsel acting on behalf of the Minister for Immigration, said the man had failed to meet the threshold for exceptional humanitarian circumstances.
“The appellant’s offending was in flagrant disregard to the rights of the victims,” Boyd said.
“It would be against the public interest to not deport the appellant because of the seriousness and number of his convictions, the extremely high monetary value and sustained nature of his offending, and the risk of recidivism.”
The tribunal took into account the man’s relationship with his daughter and that deporting him would be a significant upheaval for her.
“His parents will be faced with a difficult choice between remaining in New Zealand without their son and with the absence of the social support that he provides or a return to China with him where they no longer own a home and will face shame and humiliation of family members,” the tribunal noted.
“In addition to these factors, the tribunal has the best interests of the appellant’s daughter at the forefront of its mind as a primary consideration that must be weighed in determining whether it would be unjust or unduly harsh for the appellant to be deported.”
Ultimately, the tribunal found it would not be unduly harsh for the man to be deported.
However, it exercised its discretion to grant him a year to get his affairs in order in terms of arranging care for his daughter and parents, and to pay the remaining $640,000 he still owed his victim.
Jeremy Wilkinson is an Open Justice reporter based in Manawatū covering courts and justice issues with an interest in tribunals. He has been a journalist for nearly a decade and has worked for NZME since 2022.
BEIJING (Reuters) – China’s central city of Zhengzhou has asked residents to sell their second-hand homes to a local state-owned company and buy new ones instead, in a bid to reduce new-home inventories and boost the local property sector.
Local state state-owned company Zhengzhou Urban Development Group Co. will buy 500 second-hand homes from April 20 to June 30, according to a notice released by the Zhengzhou Real Estate Association on Monday.
Residents must buy a new home in the main urban area for a total price that is not less than the total price of the home they are selling, the notice said.
Most of China’s small and medium-sized cities have suffered frail property markets, with the entire property sector in a liquidity crisis since a crackdown on high leverage on developers in 2021.
In Zhengzhou, new home prices fell month-on-month for a 12th straight month in March, according to data from China’s statistics bureau on Tuesday.
Local cities that have been granted full autonomy to adjust property market policies have eased restrictions on home purchases, lowered mortgage rates, reduced down payments and offered subsidies for home purchases.
These policies have only limited short-term impact, partly because potential buyers have been wary of purchasing new homes amid concerns about the ability of indebted developers to deliver projects on time.
“As the bottom has yet to be confirmed, we expect property to remain a major drag on growth this year. Policies to stabilise the market will likely still be needed in the months ahead,” Lynn Song, chief economist of Greater China at ING, said in a research note on Tuesday.
(Reporting by Liangping Gao and Ryan Woo; Editing by Gerry Doyle)
Image Credits: Robert Bosch GmbH
The United States Department of Commerce Monday proposed investing as much as $6.6 billion to fund a third Taiwan Semiconductor Manufacturing Company Limited (TSMC) fab in Arizona. The funding would arrive by way of the CHIPS and Science Act, in a bid to foster more domestic semiconductor production.
The move represents a broader push to bring more manufacturing to the U.S., but unspoken in the fanfare around today’s announcement is the potential escalation of tensions with China.
The proposed fab is a greenfield facility — meaning it’s custom-built from the ground up. It would focus on 2nm (“or newer”) architectures, designed for a slew of different applications, including computing, 5G/6G wireless communications and, of course, AI. TSMC Arizona — the subsidiary behind the proposed construction — has stated that it will build the facility before the end of the decade.
The chipmaker says construction will bring more than 20,000 jobs to the area, while forecasting around 6,000 manufacturing roles once the facility is operational.
Localized manufacturing has been a key focus for the Biden administration, as the COVID-19 pandemic highlighted vulnerabilities in the global supply chain. Those issues have been exacerbated by the ubiquity of silicon in our daily lives. Those numbers are only growing. According to a semiconductor trade association, global sales hit $47.6 billion in January 2024 — marking more than a 15% increase over the prior year.
“TSMC’s renewed commitment to the United States, and its investment in Arizona represent a broader story for semiconductor manufacturing that’s made in America and with the strong support of America’s leading technology firms to build the products we rely on every day,” President Biden said in a release tied to the news.
Much of the administration’s funding has focused on U.S. firms like Intel, which was targeted with its own $8.5 billion proposal toward the end of March. TSMC, however, is an 800-pound gorilla, both in terms of market share and technological advances. The firm has, however, found itself in the middle of looming geopolitical concerns. The United States and allies would be at a massive disadvantage should China seize control of Taiwan and its manufacturing capabilities.
TSMC has its own concerns over such a scenario. For one thing, the company’s two biggest customers — Apple and Nvidia — are American. For another, some in the U.S. have even gone so far as suggesting the country bomb chipmakers, should such things come to pass.
“We should make it very clear to the Chinese, if you invade Taiwan, we will blow up TSMC,” Massachusetts Congressman Seth Moulton said at an event back in May.
The Democratic representative has since distanced himself from the clip, stating that it was selectively edited by the Chinese Communist Party. However, he is hardly alone in floating such suggestions. Earlier the same year, former Trump National Security Advisor Robert O’Brien stated, “The United States and its allies are never going to let those factories fall into Chinese hands,” suggesting the country destroy the factories. O’Brien went so far as comparing such hypothetical actions to Britain’s actions during the Second World War.
Such saber rattling has drawn international criticism. Beyond the clear ethical questions, such an evasive action would have a massive impact on the global economy. In addition to Apple and Nvidia, TSMC also serves Sony, MediaTek, AMD, Qualcomm and Broadcom, among others.
For all the money the United States government continues to invest, Intel is simply playing catch-up to TSMC’s multiyear technological head start. TSMC makes around 90% of the world’s most advanced chips. For now, the best defense the U.S. has against future disruptions — be they pandemics or geopolitical conflicts — is diversification of supply. That applies to where and by whom components are manufactured.
While the architects of the CHIPS and Science Act would no doubt love to elevate U.S. companies manufacturing domestically, ours is a global economy. TSMC is certainly aware of the value of distributing the supply chain.
“The proposed funding from the CHIPS and Science Act would provide TSMC the opportunity to make this unprecedented investment and to offer our foundry service of the most advanced manufacturing technologies in the United States,” the chip giant’s chairman Mark Liu said in a release tied to the news. “Our U.S. operations allow us to better support our U.S. customers, which include several of the world’s leading technology companies. Our U.S. operations will also expand our capability to trailblaze future advancements in semiconductor technology.”
Among those who monitor U.S.-China relations, the upcoming presidential election could mark a key turning point. Former President Trump dramatically escalated trade tensions, for one. Huawei’s addition to the entity list marked a massive setback for the mobile firm, as it lost access to key components from American companies like Google and Qualcomm.
Speaking last year, Biden’s now-former U.S. Director of National Intelligence Avril Haines noted that if a U.S. invasion halts TSMC’s Taiwan-based product, “it will have an enormous global financial impact that I think runs somewhere between $600 billion to $1 trillion on an annual basis for the first few years.”
(Bloomberg) — Investment into Australia by Chinese private and state-owned companies tumbled in 2023 to the second-lowest level in 18 years, according to a report from KPMG and the University of Sydney.
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The analysis estimated that direct investment slid 37% to $892 million from the previous year. In contrast, China’s global outbound investment jumped in 2023, driven by projects in countries participating in President Xi Jinping’s Belt and Road Initiative.
For Australia, there were declines in industries such as commercial real estate and mining that have traditionally attracted Chinese companies, according to the report, whose authors included KPMG’s head of Asia & International Markets Doug Ferguson and its China Business Practice partner, Helen Zhi Dent.
A possible shift in Chinese Belt and Road investment from infrastructure and resource off-take toward processing could herald “competitive challenges” for Australia, the team said in the report.
The data in the report exclude portfolio investments that don’t result in foreign management, ownership or legal control. Also outside the report’s scope are investments stemming from Hong Kong and Macau family offices or private entities that aren’t majority-owned by mainland Chinese corporations.
China-Australia ties frayed under former Australian leader Scott Morrison. Relations began improving after the May 2022 election of Prime Minister Anthony Albanese’s government. Last month, China lifted punitive tariffs on Australian wine exports, signaling an end to a campaign of trade pressure.
China is grappling with a lingering property crisis and weak consumer sentiment, clouding the outlook for the world’s second-largest economy.
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Meanwhile, China’s central bank has been on an easing trajectory, with its latest decision in February cutting 25 basis points from banks’ five-year loan prime rate (LPR), the largest shave since the LPR was designated as the main rate benchmark in 2019.
“From the commercial real estate perspective, the appetite is quite a tale of two countries: foreign investors continue to look for opportunities in Japan but remain very silent when it comes to China,” said Henry Chin, global head of investor, thought leadership and head of research for Asia-Pacific at CBRE.
Flows of foreign money into commercial property reflect the shift from China to Japan.
In 2019, foreign investment in Chinese commercial real estate reached US$12.3 billion, almost double the US$6.2 billion invested in Japan, according to CBRE’s tracking of all transactions worth US$10 million or greater. By 2021, this gap had narrowed, with China getting US$10.1 billion and Japan US$6.5 billion. In 2022, the two countries received roughly equal foreign investment, US$8 billion for China and US$7.7 billion for Japan. Last year, the tables turned, with Japan taking in US$5 billion and China getting just US$3.2 billion.
China’s share of total foreign investment in property declined from 38 per cent in 2019 to just 8 per cent last year, while Japan’s has been relatively steady at 21 per cent in 2019 and 17 per cent in 2023, according to data cited by JLL.
“Foreign investor appetite could not be stronger for Japan at the moment,” said Pamela Ambler, head of investor intelligence for Asia-Pacific at JLL. “Despite the recent BOJ announcement, Japan is still the only market with accretive cash-on-cash returns. In fact, monetary policy may drive domestics to look overseas, opening up opportunities for foreign investors to enter the market.”
Japan slips to world’s fourth-largest economy, behind US, China and Germany
Japan slips to world’s fourth-largest economy, behind US, China and Germany
Hong Kong-based private equity fund Axe Management Partners is one investor making a major bet on Japan’s commercial property prospects. In March, it completed an acquisition of three hotels in Osaka for 10.7 billion yen (US$71 million).
Currently known as WBF Honmachi, WBF Kitasemba East and WBF Kitasemba West, the hotels have a total of 500 rooms. They are slated to relaunch in the last quarter of the year as part of Garner hotels, a brand under UK-headquartered IHG Hotels & Resorts. They will be the midscale brand’s first hotels outside North America.
“It’s very easy to see that this is an attractive market,” said Gary Kwok, founder and CEO at Axe Management. “In terms of the interest rates, it has a positive carry, and that obviously attracted a lot of the foreign capital looking for a positive yield. And in our view one of the key asset classes is hospitality.”
Axe Management, which has earmarked more than US$85 million for the acquisition and renovation, is aiming for a return of as much as 20 per cent on the investment, Kwok said.
Hong Kong, mainland China office-leasing outlook bleak, CBRE says
Hong Kong, mainland China office-leasing outlook bleak, CBRE says
As for China, opportunities are still present, especially with a number of distressed assets available in the market, said Sam Lau, Axe Management’s founder and managing partner.
“The market is very huge, and China is a place that we can never ignore,” he said. However, the company is being more selective about investments there, he added, looking into hotels, retail and student housing in first-tier cities but avoiding residential properties and offices.
Both Chin of CBRE and Ambler of JLL forecast continued strength in the Japanese commercial property market.
“Japan has strong fundamentals with its strong, stable and transparent economy,” Ambler said. “The yen is also depreciated against major currencies such as the US and Singapore dollars and has interest rate differentials to other countries, which leads to favoured lending terms and yield differences. There are also clear exits in Japan, and it is also a relatively more liquid market.”
Foreign investors, meanwhile, are likely to have a limited appetite for China for some time, Chin said.
China property: rate of decline in investment slows, official statistics show
China property: rate of decline in investment slows, official statistics show
“Japan and mainland China are in different cycles when it comes to commercial real estate,” he said. “We continue to see the growth in Japan while China is currently going through repricing with limited leasing demand.
“The Japanese economy continues to outperform, as the country has experienced real wage growth … However, the Chinese economy faces challenges while the unemployment rate continues to be on the high side.”
UK house prices fell for the first time in three months by 0.2 percent in March, suggesting the market may be stagnating due to high mortgage rates and strained affordability.
Robert Gardner, Nationwide’s chief economist, said: “Activity has picked up from the weak levels prevailing towards the end of 2023 but remains relatively subdued by historic standards. For example, the number of mortgages approved for house purchases in January was about 15 percent below pre-pandemic levels. This largely reflects the impact of higher interest rates on affordability.”
Mortgage rates have dropped significantly from the middle of last year, when a typical five-year deal had risen above 5.5 percent. Figures from Nationwide indicated that the average was down below 4.5 percent.
The building society, which is the country’s third biggest mortgage provider and is in the process of buying Virgin Money for 2.9 billion (HK$28.51 billion), said that with the cost of living pressure easing and inflation rates reducing, consumer sentiment was improving, with surveyors reporting a pickup in new buyer inquiries.
It also indicated that wage growth was outpacing house price growth, which would make buying a home more affordable.
Staff reporter
BEIJING (Reuters) – New home prices in China rose at the fastest pace in more than two and a half years in March versus a month earlier, a private survey showed on Monday, driven by a slew of supportive steps to prop up the crisis-hit property sector.
The average new home price across 100 cities rose 0.27% on month in March, the biggest rise since July 2021, showed data from real estate researcher China Index Academy. That compared with a 0.14% on-month gain in February.
China’s property sector, a pillar of the economy, has lurched from one crisis to another since 2021 after a regulatory crackdown on high leverage among developers triggered a liquidity crisis.
A series of stimulus and easing measures from local policymakers have struggled to boost sales or increase liquidity.
Beijing city authorities marginally eased home purchase regulations last week, repealing a rule which restricted individuals from buying a home in the city within three years of divorce.
The number of cities with on-month price rises for new homes in March was 43, an increase of three from February.
Mega city Shanghai logged the highest price rise of 1.09%, whereas the northeastern city of Changchun experienced the steepest drop of 0.68%.
However, total sales by value among 100 real estate companies plunged 49.0% year-on-year in the first three months of the year, indicating a turnaround for the sector is not yet in sight.
“The intensive introduction of property market policies may lead to gradual repair of market sentiment,” China Index Academy said. “The decline in new home sales is likely to narrow in the second quarter.”
(Reporting by Liangping Gao and Ryan Woo; Editing by Christopher Cushing)
China’s Ministry of State Security issued a fresh warning this week about overseas spy agencies and what it says are their efforts in recent years to obtain state secrets under the disguise of consulting agencies.
The six-minute video released Thursday on the ministry’s official WeChat social media account reenacts what it says was a real case where overseas spy agencies instructed a consulting firm to steal classified information from a Chinese company seeking to invest abroad.
The release of the video comes as Chinese leader Xi Jinping met this week with American CEOs in a bid reassure them that China remains open for business, despite concerns about its economy and worrying signals from the authoritarian government.
Over the past year, foreign investment in China has shrunk as supply chains shift to other countries while Chinese authorities have rolled out a new anti-espionage law and used exit bans to keep business executives and others from leaving the country. It has also carried out raids on consulting and due diligence firms.
During the same period, the Ministry of State Security has ramped up its use of social media to raise the alarm about foreign spies.
Its latest video — the fourth since it launched its social media account last year — has the feel of a spy thriller with dramatic music and fast-paced video elements and graphics.
It tells the story of an executive at a Chinese company who is pressed by a consulting firm representative on a string of questions, including the company’s total profit, the technical parameters of its products, and how its products are used by the Air Force.
In a WeChat post released with the video, the ministry warned about the national security risks that consultancy agencies pose.
“The seemingly normal investigation conducted by consulting firms are in fact attempts to illegally acquire our commercial secrets and efforts to suppress our advantageous industries,” the ministry wrote, adding that these consulting firms are accomplices to foreign spy agencies aiming to infiltrate key sectors in China.
Intimidation campaign against Chinese citizens
Some experts say the video is tailored to the Chinese audience rather than foreign investors since the video is purely in Mandarin and features the arrest of a Chinese national working for a foreign consulting firm.
The purpose of the video is “to inform and intimidate Chinese citizens by telling them that the government is watching them,” said Dennis Wilder, a former U.S. national security official. He added that the campaign will likely create a chilling effect among Chinese citizens, especially those working for foreign companies.
Over the last year, Chinese authorities have raided several American companies’ offices in China and detained some of their Chinese employees. Companies affected include due diligence firm Mintz Group, business consulting firm Capvision, and management consultancy Bain & Company.
Chilling effect for new foreign businesses
While the campaign focuses on Chinese citizens, Wilder said Beijing’s efforts to safeguard national security will also create a chilling effect for foreign businesses trying to enter the Chinese market.
Unlike big foreign companies with an established presence in China, such as Apple or Qualcomm, he said companies that have no presence in China need to conduct due diligence. “They have to understand what their counterparts in China are all about, but if they can’t conduct due diligence, they won’t invest in China,” he told VOA in a video interview.
A survey conducted by foreign business groups in 2023 suggests foreign companies are increasingly pulling investments and operations out of China. Survey data show that only 45% of American companies view China as their primary or among their top three investment destinations while 66% of the companies surveyed by the European Union Chamber of Commerce in China said they found operating in China has become increasingly difficult.
Despite foreign companies’ lack of confidence in the Chinese market, some analysts say the Chinese government thinks efforts to safeguard national security and enhance foreign investors’ confidence in the Chinese market are not mutually contradictory.
“Beijing believes that while they try to attract more foreign businesses to invest in China, they also should ensure key national interests, such as core data or key infrastructure won’t be easily obtained by foreign businesses,” said Hung Chin-fu, a political scientist at National Cheng Kung University in Taiwan.
He said Beijing’s approach will be met with deep suspicion among foreign businesses. “At a time when the Chinese government has laid out many red lines in the name of national security, investing in China will be like walking on thin ice for foreign companies,” he told VOA by phone.
As foreign businesses will likely remain hesitant to increase their investment volumes in China, Wilder thinks Chinese leaders may have different views on whether to prioritize efforts to attract more foreign investment or the need to safeguard national security.
“For Xi Jinping, I think if he has to choose between foreign investment and economic growth and what he perceives as national security, he will always come out on the national security side,” he told VOA.
But for other Communist Party leaders who must consider economic growth, such as Chinese Premier Li Qiang, Wilder thinks their consideration will be different from Xi’s.
(Bloomberg) — TPG Inc. will soon close its eighth Asia buyout fund at around $5 billion, with the new portfolio set to slash its China allocation by more than half from prior regional funds, according to a person familiar with the matter.
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The investment firm plans to put about 10% of its Asia VIII pool in China, down from around 25% of invested capital in previous funds, according to the person, who asked not to be identified because the information isn’t public. TPG will allocate more than 80% in Australia, India and Southeast Asia — up from 70% in the predecessor fund, the person said. The rest will go to South Korea.
About $2 billion of the pool has already been invested, with zero investment in China so far. That has helped give the fund a strong start with a net internal rate of return of 129%, according to its earnings presentation last month. Around 70% of the initial spend has gone in India and Australia.
TPG’s exposure to China through the new fund will likely be among the lowest for global asset managers as Wall Street rivals from Carlyle Group to Warburg Pincus diversify away from China amid economic growth concern and escalating political tensions with the US. Japan and India are among the countries benefiting as capital flows to where returns are expected to be higher.
TPG early next month plans to announce the final close of the Asia VIII fund. A spokesperson declined to comment on the details.
Greater China, the region’s private equity powerhouse, suffered the biggest contraction in deal activity in 2022, contributing to a 53% drop in volume from a year earlier. That shrank Greater China’s share of Asia-Pacific deals to a nine-year low of 31%, according to a Bain & Co. report.
TPG’s $4.6 billion Asia VII fund has a net return of 14%, dragged by China investments, according to the person and public filings.
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