(Yicai) Aug. 20 -- A Chinese court has sentenced Xu Jiayin, founder of bankrupt property developer China Evergrande Group, to life in prison for his involvement in the case of Evergrande and its subsidiary Evergrande Real Estate Group. All of his assets were also confiscated.

Between 2016 and 2021, Evergrande, Evergrande Real Estate, and Xu engaged in continuous and massive financial fraud, inflating assets and concealing liabilities, according to the verdict issued by the Shenzhen Intermediate People’s Court in Guangdong province today, China Central Television reported.

Evergrande, Evergrande Real Estate, and Xu committed crimes including illegally accepting public deposits, fundraising fraud, fraudulent issuance of securities, and unlawful disclosure of material information, per the verdict. Evergrande and Xu gained control of financial institutions through bribery, illegally extracting credit and insurance funds for the group’s use, thus they were found guilty of corporate bribery, illegal loan issuance, and the unlawful use of funds.

Moreover, Xu abused his position as chairman of Evergrande Real Estate to orchestrate financial fraud and embezzle company assets under the guise of dividend distributions, according to the verdict.

The court fined Evergrande CNY8.8 billion (USD1.3 billion), and Evergrande Real Estate was fined CNY7 billion, while it sentenced Xu to life in prison and had all his personal assets confiscated.

The Shenzhen Intermediate People’s Court and the Shenzhen Nanshan District People’s Court today also sentenced 56 other individuals involved in the case, including Zhen Litao, Ke Peng, and Xu Tenghe, to prison for terms ranging from one year and 10 months to 18 years, along with fines or asset confiscation.

Evergrande’s total liabilities totaled CNY2.4 trillion (USD356.6 billion) as of June 30, last year. The Hong Kong High Court ordered the liquidation of the company in January 2024, which was delisted from the Hong Kong Stock Exchange the following year.

Only about USD255 million worth of assets had been recovered at the end of May, according to the liquidators. In comparison, creditors have claimed about USD45 billion.

Editor: Futura Costaglione