Ex-Anbang chairman Wu Xiaohui’s reversal of fortune and the questions left unanswered

Reading Time:8 minutes

In an image taken from undated video footage run by China's CCTV, Wu Xiaohui, the former chairman of the Anbang Insurance Group, speaks during a court session in the Shanghai. He went on trial on March 28 on charges that he fraudulently raised $10 billion from investors and misused his position to enrich himself. Photo: CCTV via AP Video

Jun Maiin BeijingandXie Yuin Hong Kong

Published: 1:15pm, 11 May 2018Updated: 3:28am, 12 May 2018

Wu Xiaohui, the glamorous, high-profile financier behind the insurance giant Anbang, was known for his good connections. Having married a granddaughter of Deng Xiaoping, he rubbed shoulders with political and business elites, both in China and abroad.

Coming from a humble rural family and starting from scratch, Wu built an insurance empire within only a decade, trumping giant state-owned rivals and securing heavily regulated licences.

Wu made global headlines in 2014 with Anbang’s deal to acquire the Waldorf Astoria hotel in New York from the Blackstone Group for US$1.9 billion, the largest amount ever paid for a single property.

After Wu Xiaohui was detained by Chinese authorities last June, he stepped away from his duties as Anbang’s chairman and chief executive. Photo: EPA

Thus, despite his controversial freewheeling leveraged expansion tactics – which had been long questioned by insiders – Wu’s fall from grace, which began last June when he was detained by authorities, was a shock to many.

Wu, the former chairman of Anbang Group, China’s biggest private insurance conglomerate and one of China’s largest asset buyers, was found guilty on Thursday of illegal fundraising fraud valued at US$10.4 billion, and embezzling US$1.6 billion from Anbang’s insurance premium income. The 51-year-old was sentenced to 18 years of imprisonment.