Deborah Cornwall reported this story on Tuesday, October 21, 2014 08:14:40
CHRIS UHLMANN: Corrupt Chinese officials who fled to Australia with an estimated one billion dollars in bribes and embezzled money are about to be targeted by an unprecedented joint China-Australia police operation.

Operation Fox Hunt is part of the Chinese Government’s aggressive anti-corruption campaign.

It has now been extended to former Chinese party officials who have resettled in the West, often under fake identities.

Deborah Cornwall with this report.

DEBORAH CORNWALL: In China, they’re known as the “naked officials”, trusted public servants who fleeced millions from the Chinese state then moved to the West to reinvent themselves as self-made billionaires.

Shaun Rein is a market analyst based in China and managing director of the China Market Research Group.

SHAUN REIN: You go to a lot of these communities in California, and it’s all former officials’ families, and they’re living in $10-20 million mansions. And the question comes: how exactly did they get that money?

When you go into Sydney, you know, a lot of the $10, 20, 30 million properties, similarly, are being bought by Chinese with connections to officialdom.

These people are not the prize that a lot of Australians had hoped for, and that they’re really corrupt; they’re not necessarily the type of business people that you want as part of your community.

DEBORAH CORNWALL: Tracking down those corrupt officials is now that latest phase in the Chinese Government’s ferocious anti-corruption campaign.

China is now in joint investigations with police in a number of western countries, including the United States.

The Australian Federal Police will start their joint operation next month, beginning with the seizure of assets of seven Chinese, all of them on Beijing’s Top Most Wanted list of fugitives.

SHAUN REIN: President Xi’s anti-corruption crack-down is very serious. He’s getting a lot of these ill-gotten assets back from corrupt government officials and their families who fled -to scare the current officialdom, because even if you retire and leave the country, we will come after you.

DEBORAH CORNWALL: In China’s highly influential business magazine, Caijing, says Australia has become a favourite bolthole for corrupt Chinese officials and businessmen.

Shaun Rein says this is partly because Australia’s taxation authorities are relatively lax compared to other countries like the United States.

SHAUN REIN: A lot of the corrupt officials feel that Australia’s not quite as aggressive, either trying to get personal income taxes or investigating, because a lot of these officials will keep several identities; they’re never really reporting their taxes to anyone appropriately.

DEBORAH CORNWALL: The Australian Federal Police have yet to explain how they propose extradite the targeted Chinese fugitives, or seize allegedly stolen assets that have long since been laundered through legitimate business ventures.

David Goodman is a professor of sociology at Nanjing University, China.

DAVID GOODMAN: There’s no doubt the move to prosecute people who’ve had their snouts in the trough is a popular move. What worries me is the extent to which there are checks on the behaviour of the state in both cases.

In China, in particular, there is a whimsical element to the state, and in Australia, there is a climate of deep suspicion in some places about Chinese investment.

CHRIS UHLMANN: That was David Goodman, a Professor of Sociology at China’s Nanjing University speaking with Deborah Cornwall.