The Great Escape: Suspected Corrupt Bureaucrats (And Their Billions) Flee China in Droves

If Chinese experts are correct, more than 16,000 corrupt officials have left China within the past two decades. The amount of money they may have absconded with is possibly more than 1 trillion yuan, or $158 billion. That's about as much as the U.S. government spent in the initial 2008 Economic Stimulus Act. Much of that money was likely skimmed from government accounts, public works projects, taken as bribes, or collected illegally and directly from citizens.

Most of those allegedly criminal bureaucrats continue to reside abroad without much fear of being returned to China for prosecution. Many of them have chosen to set up comfortable new homes with their families in North America, using their ill-gotten capital to set up their own, close-knit residential communities.

The above information appeared on Tuesday in the China Economic Weekly, a major magazine focusing on finanial and economic news supported by Communist Party newspaper People's Daily. The story was based on data and interviews with some of the country's leading scholars and investigators.

The Supreme People's Procuratorate (China's highest judicial organ for investigation and prosecution of criminal and civil offenses), assisted by police and customs agents, says that from 2000 to 2011 the government captured 18,487 officials who were trying to flee from the country. Many were leaving to avoid prosecution, but others already had immediate families (and billions) overseas, and were bent on an upscale life abroad in the West.

According to the Supreme Procuratorate, the value of goods and capital confiscated from those officials attempting to escape was 54.2 billion yuan or almost $8.6 billion.

The official figures may however be just the proverbial tip of the iceberg.

In 2011, the Chinese Academy of Social Sciences (CASS) estimated that between 16,000 to 18,000 corrupt officials had already left the country since the 1990s. They took with them, or had already moved out, as much as 800 billion yuan or $126 billion.

An anonymous member of the Central Commission for Discipline Inspection, an internal party accountability organization, was quoted by China Economic Weekly as saying even that number could be considered an understatement.

Li Chengyan, a professor at the Honest Politics Research Center in China's prestigious Peking University, says the true value of assets moved abroad by officials is higher than 1 trillion yuan.

And just as they move money out of China, the corrupt officials are also moving family members -- all with the goal of establishing a beachhead overseas and eventually joining them.

In February 2012, CASS claimed that many civil servants were leaving China by first sending their spouses and children abroad to acquire citizenship and permanent residency rights.

The numbers indicate a definite trend. The organization, the country's foremost social science research institution, says that 38.9 percent of China's civil servants today have spouses with foreign passports or permanent residency rights in foreign countries. 46.7 percent have sons or daughters that hold the same privileges abroad. Those are convenient pathways for officials to ultimately leave and gain protection overseas. For local officials at the provincial and county levels, the number of those with immediate family abroad on altered national or residency statuses was higher than 50 percent.

Of course, those numbers don't readily translate to indicate the overall percentage of corrupt officials. Many may simply want their children to be educated abroad, or may have married Chinese who have worked overseas long enough to get residency in a foreign country. But the numbers certainly represent an area of concern for the government, especially in instances when an official becomes the only member of their immediate family residing in China.

CASS says that the vast majority of allegedly corrupt officials are from the state financial system or large- and medium-sized, state-owned enterprises, some 87.5 percent. Chinese experts say that most are over the age of 50.

Much of the money is being moved by officials and their family members directly in cash as they travel abroad. More often, agents and third parties move it for them through illegal pathways. A large amount of capital is also being transferred through illegal offshore accounts.

There's even a hierarchy of preferences for places to flee to. Western nations like the U.S., Canada, the UK, and Australia are preferred by the richer and higher-ranking officials. Countries like Thailand, Myanmar and Malaysia are the destinations of the less well-off beneficiaries of graft.

Western countries like those listed above have not signed extradition treaties with China, and are wary of punishing white-collar crimes using heavy-handed methods

The highly publicized example of mega-smuggler Lai Changxing is a case in point. The Canadian legal system delayed his return to China for years due to worries that he would be executed there. In China, however, there's an appetite for the government's harsh measures against white-collar offenders. Indeed, many are incensed by pervasive corruption and its capacity to destroy the livelihoods of average citizens, and welcome severe means to deal with such incidents.

The Chinese government says it has stepped up the battle against internal graft and is also working to prevent corrupt officials from fleeing abroad. Regardless, Western analysts will be quick to question whether new efforts by the central government to improve political education and accountability for local officials have really paid off in past years.

Once again, the numbers paint a worrisome picture: In just one day in late September 2003, before China formally ratified the U.N. Convention Against Transnational and Organized Crime, 51 officials attempted to flee the country between September 30 and October 1, marking a record. During the following week, when China was simultaneously celebrating its national holiday, 115 attempted to escape.