The founder of China Evergrande Group, once the world's most indebted property developer, was sentenced to life in prison on Thursday after being convicted of financial crimes.
Hui Ka Yan, who founded Evergrande in 1996, pleaded guilty in April to eight charges, including misuse of funds, fundraising fraud and illegally taking public deposits. A court in Shenzhen also ordered the confiscation of his personal property.
Evergrande, once China's biggest property developer, defaulted in 2021 on most of its roughly $300 billion in liabilities. Its collapse became emblematic of the prolonged crisis in China's property sector, which continues to weigh heavily on the world's second-largest economy.
At its height, Evergrande was the biggest company in China's real estate industry, a sector that at the time accounted for about a third of the country's gross domestic product. The property market was a major engine of economic growth and an important source of revenue for local governments.
Evergrande's implosion has often been blamed for triggering a broader slump in China's property market. The crisis has persisted as several other major developers have also faced financial difficulties, further weighing on the economy.
The Shenzhen court also fined Evergrande 8.82 billion yuan ($1.31 billion) and its main subsidiary, Hengda Real Estate, 7 billion yuan. Five other senior executives were handed prison terms ranging from six to 18 years and fined.
Hui's conviction brings a dramatic end to his rise from humble beginnings to becoming one of China's richest men. He was ranked as China's richest person in 2017, with an estimated net worth of $43 billion.
He listed Evergrande in Hong Kong in 2009 after raising around HK$6 billion in its initial public offering. The company expanded rapidly, fuelled heavily by debt, but was eventually unable to meet its obligations as China's property market deteriorated.
Hui's life sentence marks a major reckoning for the fallen property tycoon, but is unlikely to provide much relief to Evergrande's domestic and foreign creditors, who continue to face huge losses from the company's collapse.