China’s most-wanted man appears in court in ‘the city he once owned’

In a few short years, his business quickly spread, into shipping, cigarettes,
paper, textiles, umbrellas, finance, and consumer electronics. He then
started up an import-export company which the Chinese authorities claim was
merely a front for a spectacular smuggling ring that shipped in everything
from Mercedes-Benz saloons to pornography.

In one case, uncovered by investigators, Mr Lai’s ships allegedly brought in
more than ten million packets of cigarettes in 1999, dodging £11 million of
duty by disguising them as wood shavings.

Altogether, he is accused of earning £4 billion from smuggling in just the
three years from 1996 to 1999, a sum almost equivalent to Xiamen’s annual
GDP.

With his profits, Mr Lai is said to have paid off almost every Communist party
official in the city, entertaining many of them at the Red Mansion, his
headquarters, a seven-floor building equipped with hotel suites,
prostitutes, jacuzzis, banqueting rooms and karaoke.

He built a £10 million replica of the Forbidden City on the outskirts of
Xiamen, bought the city’s football team, and broke ground on what was to be
an 88-floor skyscraper. It is claimed that a special team of investigators
had to be sent from Beijing to bring him down, since he had already bought
most of Xiamen’s police force.

In August 1999, however, he was tipped off about his impending arrest and
fled, first in a speedboat to Hong Kong, and then on to Vancouver, where he
lived until last year. Two of his three brothers have died in prison in the
interim. Enraged, the former Chinese premier, Zhu Rongji, swore to pursue Mr
Lai ceaselessly, saying it would be justice if he was executed “three times”.

However, the Chinese government promised Canada that Mr Lai would not face the
death penalty if he returned and was convicted, despite 14 other defendants
in the case being given the ultimate penalty.

“He will probably get life in prison,” said Lu Qi, a lawyer at the Heng Da
practice in Shaanxi province. “The others were given the death penalty, but
the law has since been amended. Life is now the maximum penalty for these
crimes. Lawyers believe there is a link between this amendment and Mr Lai’s
case.”

Mr Lai divorced his wife, Zeng Mingna, in Canada in 2005. She, and two of the
couple’s three children are thought to have returned to China, according to
the website of the People’s Daily. His younger and only surviving brother,
Lai Changtu, now lives in Jinjiang after being released from prison in 2008.

Mr Lai remains popular in Xiamen, where his largesse convinced many residents
that he had helped the city far more than its government officials. Cai
Yong, a 30-year-old IT engineer, said Mr Lai had built a number of “schools,
roads, and bridges”.

“My primary school was built by him,” he said. “I think a third of the city’s
businesses were linked to him at one point. He helped one of my uncles and
never asked for anything in return.” Since Mr Lai’s departure, the city has
been caught in a relative slump, Mr Yong said.

“Smuggling is a crime, but even military people did it in Hainan in the past.
For us natives, Lai’s contribution to Xiamen easily offsets the crime he
committed,” he added.

“The majority of the government officials take bribes but fail to do their job
properly. Lai was much better. But it has been 12 years by now, and people
tend to be forgetful. I’m not sure if anyone here in Xiamen would rise up
and protest if he gets a life sentence or worse.”

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