BEIJING – In a landmark ruling that underscores the fallout from one of the world’s biggest corporate debt collapses, the Shenzhen Intermediate People’s Court handed down a life prison sentence Thursday to Hui Ka Yan, the flamboyant founder of Chinese property giant Evergrande Real Estate Group. The court’s official statement also issued massive financial penalties, imposing an 8.82 billion yuan ($1.31 billion) fine on Evergrande Group and a separate 7 billion yuan ($1.04 billion) fine on its core real estate arm, Evergrande Real Estate.
Hui, who is also known by his Chinese name Xu Jiayin, had already entered a guilty plea back in April to a sweeping set of criminal charges, spanning large-scale fraud, illegal absorption of public deposits, and corporate bribery. The conviction and sentencing close a major chapter in a crisis that has shaken global confidence in China’s $60 trillion property sector.
Once China’s top-selling property developer and a symbol of the country’s explosive infrastructure and housing boom, Evergrande spiraled into insolvency after years of unchecked aggressive expansion fueled by relentless borrowing. By the time a Hong Kong court ordered the firm into liquidation in 2024, it held more than $300 billion in total liabilities, earning it the unenviable title of the world’s most indebted real estate developer.
The company’s collapse was triggered in large part by a 2020 Chinese government regulatory crackdown designed to rein in reckless leverage and systemic risk across the property sector. But the sudden implosion rippled far beyond Evergrande itself, tipping the entire Chinese real estate market into a prolonged downturn that has hit consumer confidence, halted thousands of construction projects across the country, and spilled over into the broader domestic economy.