Chinese Billionaire’s Money Laundering Conviction Sends Shockwaves Through Bordeaux Chris Lehoux, May 23, 2024 Qu Naijie, the founder of Haichang Group, reportedly bought 27 Bordeaux châteaus within a short period of time. However, French officials discovered that some of these transactions were illicitly funded by the Chinese government. Qu Naijie, who is now 63 years old and the creator of the Chinese firm Haichang Group, has been convicted by a Paris court for money laundering. They issued him a suspended jail term of three years, ordered him to pay a fine of €1 million, and seized nine of his Bordeaux châteaus. These seized properties are believed to be worth approximately €35.5 million ($38.4 million). This verdict has left the Bordeaux region shocked. Qu was among the many affluent Chinese individuals who came to this region about ten years ago and purchased lesser-known châteaus with the intent of investing in them and promoting them to the burgeoning Chinese wine market. He is now being accused of fraud by both French and Chinese authorities. Qu was a prominent figure in Bordeaux. He collaborated with Christian Delpeuch, ex-president of the Bordreax trade association called Le Conseil Interprofessionnel du Vin de Bordeaux (CIVB) and the former CEO of the merchant Ginestet. Between 2010 and 2014, the pair acquired 27 Bordeaux wineries, spending a total of $67 million. Delpeuch contributed his knowledge on vineyard management for these acquisitions. High-profile châteaus were not on Qu’s purchase list. He chose neglected estates on the brink of sale, wineries that couldn’t secure a consumer base in Europe or America. These he rebranded for the flourishing Chinese market. Concurrently, leading Chinese industry figures, such as Alibaba Group founder Jack Ma, property and investment executive Pan Sutong, and movie celebrity Zhao Wei, also made substantial investments in Bordeaux vineyards. Qu’s wealth came from oil trade before diverting to chemicals, plastics, diamonds, property, and theme parks. He envisioned establishing a bond, both commercial and cultural, between his native city, the industrial harbor of Dalian, and Bordeaux. Qu started the construction of a fancy château-inspired housing community in Dalian, complete with vineyard and a vast cellar to store and vend Bordeaux wine. In 2011, the undertaking was inaugurated at the Bordeaux Chamber of Commerce and Industry (CCIB), attended by négociants and municipal officials from Bordeaux and Dalian. Qu, always discreet in public, was an attendee, giving the spotlight to officials, politicians, and consultants. Qu also worked to promote wine tourism in Dalian. Inspired by the success of the Hong Kong Wine and Dine Festival, an event mimicking Bordeaux’s popular wine festival coordinated with the CCIB, CIVB, the Bordeaux Tourism Office, and numerous wine-focused promotional associations, he reached out to the CCIB and requested them to replicate the same event in Dalian. The organization experienced challenges following the inaugural festival, and subsequently, the relationship deteriorated. Additional indicators of impending trouble surfaced. Delpeuch legally separated himself from Qu’s assets. Labor practices not aligning with French laws arose, reported by the press. Delpeuch clarified to Wine Spectator that he only offered consultations relating to vineyards and had no involvement in château acquisitions and finances. Subsequently, political dynamics in China transitioned. Xi Jinping assumed the presidency in 2013 and initiated a campaign against corruption evident from the public declarations. It led to arrests, asset seizures, notable individual disappearances, and executions. Although the mean income of ordinary Chinese citizens increased amid the country’s economic surge, those closely associated with the government were amassing huge fortunes. In 2014, a damning report on firms suspected of practicing corruption was released by the predominant National Audit Office (NAO) of China. It declared that Haichang Group and another firm based in Dalian had diverted 268 million Chinese yuan—equivalent to more than $30 million at that time—from governmental funds intended for purchasing Bordeaux vineyards. These funds were specifically designated for foreign investments in science and technology domains as part of the Chinese government’s initiative to acquire essential foreign assets like commodities, manufacturing, and infrastructure to enrich the Chinese economy. The technology category includes agriculture. There were no reports of arrests or court cases in China, but Qu vanished from public life. The audit managed to draw the attention of French investigators from the Direction Interrégionale de la Police Judiciaire in Bordeaux. The investigators uncovered offshore corporations located in the British Virgin Islands and a loan secured from the Chinese bank ICBC in Paris, aided by fabricated legal documents. A series of violations were detected which resulted in confiscation of several châteaus belonging to Qu in 2018. The Central Office for Major Financial Crime Suppression became part of the investigation. Focus was also placed on those who facilitated the acquisitions in France. The authorities clarified that they found no evidence of deceit in the chateaus’s winemaking activities. In 2019, the case was officially announced by the French government’s financial prosecutor’s office. Investigations were narrowed down to Qu, a vintner, and Exco Ecaf, a Bordeaux-based accounting firm that was previously headed by Pierre Goguet, the CCIB’s chairperson. During the court proceedings in Paris in February, the French financial prosecution unveiled a complicated network of shell businesses registered in the British Virgin Islands, evidences of money laundering, and other violations. Several of the vineyards, according to the prosecution, were registered under Qu’s wife’s name. Besides Qu, his worker, Jian Liu, received a 18-month suspended sentence along with a penalty of around $54,000 for producing false documents, forgery, and deception. Notably, the accounting firm Exco Ecaf was cleared of charges of not reporting crimes to the government auditors. Qu’s defense lawyer, Maxime Delhomme, said that they will likely appeal the verdict. His clients, Mr. Qu and Mr. Liu, had been dealt bad luck, he said. With the confiscation of the châteaus, they had been “plucked twice.” Stay on top of important wine stories with Wine Spectator’s free Breaking News Alerts. About the Author: Chris Lehoux Meet Chris Lehoux, an experienced wine connoisseur and dedicated blogger with a deep passion for all things wine-related. With years of expertise in the industry, Chris shares insightful wine reviews, valuable wine tasting tips, expert pairing advice, and captivating tales of vineyard visits. Join Chris on a journey through the world of wine, where every sip is an adventure waiting to be savored! Wine