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China will keep a close watch on officials whose spouses and children emigrate abroad to prevent corruption By Wang Hairong

Among the new additions to Chinese mainland residents’ vocabulary in recent years,luoguanhas caught great public attention for its message.

Luoguan, literally “naked officials,” refers to officials whose spouses and children have migrated to another country.

A report released on February 20 by the Chinese Academy of Social Sciences (CASS) claims that “naked officials” are vulnerable to corruption.

The report says that most corrupt officials move their spouses and children, as well personal assets, abroad, in order to flee more easily once their wrong-doings are exposed.

“The Chinese Government already has data on so-called ‘naked officials’,” said Minister of Supervision Ma Wen on March 3 while attending this year’s full session of the National Committee of the Chinese People’s Political Consultative Conference (CPPCC) in Beijing. But she did not disclose the number of such officials.

High corruption risk

The phrase “naked official” was coined in 2008 by Zhou Feng’an, a member of the CPPCC Jiangsu Provincial Committee, in an article he wrote about the corruption case of Pang Jiayu, former Vice Chairman of the CPPCC Shaanxi Provincial Committee. In June 2008, Pang was sentenced to 12 years in prison and confiscation of personal property on charges of bribery and dereliction of duty. Pang’s wife and child emigrated to Canada in 2002.

Several high-ranking officials who have recently been investigated for corruption were also found to have moved their spouses and children overseas. Offenders often carefully plot their escape years before their crimes are uncovered.

In February 2011, Zhang Shuguang, then Director of the Transportation Bureau of the Ministry of Railways, was removed from his posts and probed for corruption. The bureau Zhang headed is in charge of procuring railway equipment, tendering, and high-speed train technology transfers.

Zhang had been living alone in Beijing while both his wife and daughter emigrated to the United States. It’s reported that his wife Wang Xing owns three luxury mansions in Los Angeles and the couple had deposited a large sum of money in foreign banks.

The phenomenon of “naked officials”does not only exist in government departments, but also in state-owned enterprises.

“NAKED OFFICIAL”: Zhang Shuguang (middle), a former senior official with the Ministry of Railways who is being probed for corruption, answers questions about China’s high-speed trains on December 3, 2010

Li Xiangdong, former General Manager of the Sichuan Wireless Music Base, a subsidiary of China Mobile, the country’s largest wireless service provider in terms of subscriber numbers, disappeared on the evening of March 25, 2010, after meeting auditors from the National Audit Office.

Li was suspected to have fled overseas with millions of dollars of ill-gotten gains. Early in 2004, Li’s wife Yao Hong quit her job as vice general manager of the Sichuan branch of China Telecom, China’s third largest wireless service provider, and emigrated to Canada. In April 2010, procuratorial authorities of Sichuan Province said that Li was captured on March 31 by the police while on the run.

On July 28, 2010, Dong Yuejin, former Assistant to General Manager of the China International Telecommunication Construction Corp. was put on trial. Dong was accused of embezzling 580 million yuan ($92.05 million) of public funds and taking bribes. Dong’s wife and son had already settled in the United States, allegedly taking the misappropriated funds with them.

Unofficial figures estimate that over the past three decades, more than 4,000 corrupt Chinese officials have fled to foreign countries, taking ill-gotten assets worth more than $50 billion out of the country.

Intensified oversight

In response to the “naked official” phenomenon, in July 2010 general offices of the Central Committee of the Communist Party of China (CPC) and the State Council jointly issued a regulation on tightening oversight over civil servants whose spouses and children have foreign nationality or permanent residence.

The regulation requires officials above the deputy-county-head level in Party and government departments, public institutions, social groups, and state-owned and stateholding enterprises to report any changes in their spouses’ and children’s immigration status in foreign countries. They should also submit written accounts on all income and property owned by their spouse and children living overseas, and on any changes in their financial conditions.

The regulation says that when “naked officials” apply for private passports or are to be promoted, they should undergo examinations by discipline watchdogs.

“Officials whose duties or services are related to the countries and regions where their spouses and offspring are residing should voluntarily report their families’ resident status to higher authorities; if conflicts of interests are involved, the officials should not be allowed to hold related posts,” the regulation says.

CFP

Despite the regulation, the CASS report says that the current mechanism for oversight over“naked officials” is weak. For example, information about the resident status of official’s family members is unavailable to the general public.

The report suggests that all civil servants should be required to declare their properties overseas and the public should be given access to property, residence and citizenship status information disclosed by officials. In addition, a system should be set up to verify the information provided and those reporting false information should be punished.

Competence debate

In 2009, Shenzhen in south China’s Guangdong Province introduced a ban on“naked officials” holding top positions in major Party and government departments. In January, the Guangdong Provincial Government adopted a similar policy.

Not everyone agrees with these oversight measures. Some people argue that foreign residence and citizenship status is not necessarily a sign of corruption, and the family members of civil servants should have the same right to immigrate as ordinary citizens.

According to a survey conducted by the CASS, 34.2 percent of the general public and 38.9 percent of civil servants said that it is alright for family members of civil servants to hold foreign citizenship.

Gao Xinmin, a professor at the Party School of the Central Committee of the CPC, said that there are several types of “naked officials,” and they should be treated differently.

She said that in the 1990s, after the disintegration of the former Soviet Union, some officials sent their families abroad because they did not have enough confidence in the future of the Party and the country. Yet as things have changed in recent years, especially because the Chinese economy has been growing well, very few people still hold this belief.

“Currently, family members of many civil servants go abroad for normal reasons, such as to study. There is nothing wrong with that,”Gao said. “Only a small number of officials committed crimes, so they sent their families abroad and planned to join them later.”

Anti-corruption experts say that keeping corrupt officials from fleeing the country is just one tactic in the fight against corruption, and what is more important is to tackle corruption from the root by establishing a system where officials cannot and are not willing to embezzle public funds.

International cooperation

According to Wang Minggao, Vice President of the Hunan University of Commerce who has headed several government-sanctioned anti-corruption research programs, former Chinese officials who embezzled large sums of money usually flee to Canada, the United States and Australia, whereas those pilfering smaller amounts tend to take shelter in neighboring countries. Some corrupt officials also make their way to small Pacific island countries and Central American countries.

Previously, because China did not have bilateral extradition agreement with some foreign countries, many corrupt officials and economic criminals were able to live openly and freely at their new homes.

However, in December 2005, the UN Convention Against Corruption (UNCAC) entered into force. China officially ratified the convention in January 2006 and it is now able to seek the extradition of persons wanted for corruption.

Zhang Zhihui, Secretary General of the Society of Public Prosecutors of China, said that under the UNCAC, member states are obliged to assist each other to fight against corruption, which means, more countries will deport corruptive fugitives to China.

As of December 13, 2011, the convention had been ratified, accepted, approved or acceded to by 158 countries. The United States and Canada, two major destination countries for corrupt officials, respectively ratified the convention in October 2006 and October 2007.

In July 2011, Canada deported Lai Changxing, a famous fugitive who fled from China to Canada in 1999 after being accused of heading a multibillion-dollar smuggling operation in Fujian Province. This put an end to a 12-year legal battle between China and Canada over Lai’s extradition.

The Ministry of Public Security said in a statement that “Lai’s deportation once again shows that no matter where a criminal suspect flees, he or she cannot evade legal sanctions in the end.”