HNA sues fugitive tycoon Guo Wengui over corruption allegations
Chinese company that owns Irish aircraft leasing firm Avolon files defamation lawsuit
The HNA logo on a building in Beijing. Photograph: Getty Images
Chinese conglomerate HNA, the company which owns Dublin-based aircraft leasing firm Avolon, has filed a defamation lawsuit in New York against fugitive property tycoon Guo Wengui after a series of allegations of corruption against the company and of inappropriate links to Communist Party leaders and their families.
Also known as Miles Kwok, Guo has accused senior cadres, including anti-corruption czar Wang Qishan, and their relatives of having undisclosed shareholdings in HNA, and of facilitating irregular overseas M&A activity.
He further accused HNA’s Hainan Airlines unit of allowing government officials to use a VIP aircraft “for purely personal reasons.”
HNA has rejected Guo’s accusations as “baseless and meritless”, but they have had an effect - in April, HNA’s shares on the Hong Kong stock exchange fell nearly 17 per cent soon after he began his volley of online accusations.
HNA last year bought Avolon for €2.25 billion, in a deal ultimately worth nearly €7 billion.
In a statement on its website, the financial services-to-aviation company said Guo’s claims “have harmed HNA Group’s reputation” and that it would “vigorously pursue” its claims against him.
HNA and its high-profile chairman Wang Jian have been on a €36 billion buying spree in recent months and the high degrees of leverage involved will have been noted by the central government, especially at a time when Beijing is dealing with pressure over rising debt levels and has been trying to slow the pace of capital flight overseas.
In his tweets, Guo depicts himself as being an anti-corruption champion. In one tweet on Friday, he shows himself as Lei Fang, a propaganda icon who sacrificed his life for the Communist Party.
“I’m against having the country being run by a consortium of police and mafia,” he written in Chinese-language messages to his 250,000 followers – a hefty number for a service banned in China.
His tweets and self-made YouTube videos are banned in China, but they have been filtering through and are causing irritation among the Communist Party elite as it gears up for a major five-yearly congress in the autumn to reshuffle the ruling elite under President Xi Jinping.
Beijing has been piling on the pressure. Three executives at his company Beijing Pangu Investment were convicted by the Dalian Xigang People’s Court on Friday of using fraudulent means such as producing fake contracts and company stamps to obtain huge amount of loans. One was jailed and two others received suspended sentences, ostensibly because they had acted on Guo’s orders.
Through state media, the government has launched a major campaign to discredit Guo and have issued writs in China against many of his companies.
Guo has boasted of his close links to the former state intelligence chief Ma Jian, who also faces corruption charges and in April confessed to being bribed by Guo. Media reports say nearly €8 million in bribes changed hands.
In an interview with the Voice of America in April, Guo claimed to have evidence of corruption at high levels of the Communist Party, causing a major stir in China.
Interpol has issued a “red notice” international alert at the request of the Chinese authorities, while a group of nine Chinese companies launched a €45 million lawsuit in the US against him to obtain compensation for assets they have not succeeded in recovering after winning court cases in Beijing.
One of Guo’s most famous developments was the Pangu Hotel near the Olympics site, a self-designated seven-star hostelry with a bizarre roof like the Olympic torch with a suite that cost nearly €30,000 a night to rent. The hotel has since been renamed.