China Gang Boss Buys Hong Kong Mansion for HK$450 Million, Gets Arrested in China

On May 6, the Chinese Communist Party (CCP) arrested 17 members of a China Black Societies (gang) operating in Wuhan, Hubei province, including the notorious boss Huang Dafa and Xiong Daxi. Both Huang and Xiong held Hong Kong identity cards (HKID). In 2018, Xiong purchased a standalone house on Repulse Bay Road for approximately HK$496 million ($63 million) before selling it to Huang for HK$450 million ($57 million) in April this year. However, Xiong was arrested the day after the registration documents were filed. Some commentators believe that this substantial transaction triggered concerns about capital flight from the mainland and was deemed a threat to national security by the CCP.

Huang, 61, and Xiong, 60, are reported to live in Wuhan but have their residence in Hong Kong. Huang purchased House 7 of 90 Repulse Bay Road from Xiong for HK$450 million in April. It was discovered that he paid a stamp duty of 4.25 percent on the property price, indicating that it was his first property purchase as a Hong Kong permanent resident.

In Hong Kong, the standard procedure for a first-time property purchase as a Hong Kong permanent resident requires making a declaration at a law firm stating that the purchase is made on one’s behalf and that no other residential property is owned. This means Huang was still in Hong Kong at the end of last month to complete the necessary procedures. It is not ruled out that Huang intended to transfer funds to Hong Kong but was restricted by mainland China’s remittance restrictions, so he resorted to a physical transaction to apply to the mainland authorities.

In 2009, Xiong purchased a mansion in Yuen Long’s The Vineyard La Maison Vineyard using a mainland Chinese passport and an Exit-Entry Permit for Travelling to and from Hong Kong and Macau (two-way permit) for HK$18.5 million ($2.3 million). However, when he purchased the Repulse Bay mansion in June 2018, he registered it using his Hong Kong identity card. On the same day, a person named Liu Qing purchased another standalone house adjacent to the property for HK$508 million ($64.9 million). Both Liu and Xiong reported their addresses as the same unit in The Reach, Yuen Long. This indicates a close relationship between the two individuals who acquired neighboring properties in Repulse Bay for HK$1 billion ($128 million).

Former Wuhan People’s Congress Representative and Gang Boss

According to mainland media reports, Huang, born in 1961 and originally from Wuhan, served in the military at 18 before returning to his hometown and becoming the secretary of the party committee of Jinggangshan Village, Hongshan Township, Wuhan. In 2001, he founded a real estate company and secured several notable projects over the next decade. Throughout this process, Huang continuously recruited enforcers and influenced legal and illegal activities, including violent demolitions and suppression of competitors.

“China Economic Times” reported in May 2016 that in July 2014, Huang and his brother Huang Dacai illegally seized farmland through the transformation of urban villages and forcibly acquired Renfu Pharmaceutical Factory on Xiongchu Avenue and Shaishui Road in Wuchang, Wuhan, leaving dozens of employees jobless. In February 2016, Wuhan Aile Music School and other buildings in Banqiao Village were forcibly demolished, with over two hundred thugs armed with knives, harpoons, steel pipes, and firearms participating in the violence, resulting in one death and dozens of severe injuries.

The exposure of the violent forced demolitions shocked the nation, but Huang remained unscathed. According to a source in the public security bureau quoted by mainland media, Huang was the only person who could mobilize two hundred people for forced demolitions and violence in Wuhan because of “his powerful backing” and “No one can control him.”

Ironically, before his arrest, Huang was promoted by the authorities as a key figure in the turnaround of Jinggang Village, hailed as the “leader of the village’s path to prosperity and a comfortable life.” Huang’s Jianghong Group was packaged as a “well-known enterprise in Hubei” and one of the “top ten in the market.” Mainland Chinese reports indicate that in November 2011, Huang also served as a representative of the Wuhan People’s Congress.

Dr. Gavin Chiu Sin-hin: “Capital Flight” Is Now Considered a Threat to National Security

Hong Kong scholar and commentator Gavin Chiu pointed out on his “Gavinchiutalk” YouTube channel on May 10 that during the 2018 U.S.-China trade war, many mainland Chinese companies tried to do “capital flight” through the Belt and Road Initiative and Hong Kong, buying properties, insurance, stocks, and companies in Hong Kong to transfer black money from the mainland. Stashing or legally using 1 billion yuan is difficult in mainland China but can be used to “buy two apartments in Hong Kong.”

Chiu believes that as the head of the group, Huang purchased units from his subordinate Xiong in April and was arrested half a month later. He analyzed that being too high-profile in “capital flight” at this time, combined with the post-pandemic situation and the prospect of a Sino-U.S. rupture and a possible Taiwan war, “capital flight” has become a threat to national security.

Using Alvin Chau Cheok Wa, nicknamed Sai Mai-wa, as an example, Chiu mentioned that he had been involved in online casinos in the Philippines and Cambodia and had been recognized by the authorities, becoming a member of the Guangdong CCP advisory body. The Macau government has also commended him multiple times. However, he was still arrested recently because of the changes after the pandemic. China has shifted from being an “open country” to a “closed country” for war preparedness, and “what could be done before does not mean it can be done now.”

Xiong’s Property Purchase Probably Makes Him a Hong Kong Resident

In October 2003, the Hong Kong government introduced the Capital Investment Entrant Scheme (CIES), which allowed individuals to reside in Hong Kong by investing HK$6.5 million in various assets, including real estate, financial assets, and investment-linked insurance products. As per the scheme’s requirements, mainland Chinese applicants must first obtain residency in a third country and have a minimum net asset of HK$6.5 million ($880,000) for at least two years before formal application. Upon approval, successful applicants who purchased the qualifying assets were granted entry permits, which could be converted into Hong Kong permanent resident identity cards and Hong Kong passports after seven years.

As early as 2009, Xiong purchased a villa in Yuen Long’s The Vineyard La Maison Vineyard for a lump sum of HK$18.5 million ($2.3 million), using a mainland Chinese passport and a two-way permit for registration. However, when he purchased a villa in Repulse Bay in June 2018, he registered it with HKID.

By 2010, there was growing concern that mainland Chinese investors were driving up property prices through immigration to Hong Kong. In response, the then-Chief Executive, Sir Donald Tsang Yam-Kuen, announced in the Policy Address that the minimum investment threshold for the scheme would be raised to HK$10 million, and the option to invest in real estate would be discontinued.

Data from 2010 indicated that since the scheme’s implementation, approximately 8,200 applicants and 15,500 dependents had been granted entry to Hong Kong, with about 80 percent being Chinese nationals holding foreign citizenship. These individuals brought a total investment of HK$58 billion to Hong Kong. However, the entire Capital Investment Entrant Scheme was eventually suspended in 2015.

Nevertheless, the Financial Secretary, Paul Chan, announced earlier this year that a new capital investment scheme would be introduced. Under the new scheme, applicants must invest certain assets in the local market. After passing the examination, they would be allowed to reside and develop in Hong Kong, excluding property investment.@