Shanghai police have detained the founder and CEO of the city’s largest immigration consultancy firm, prompting warnings to Chinese people to leave immediately or not return amid fears the authorities will crack down on an ongoing wave of mass emigration.
The Shanghai police force’s economic investigations department said via the Weibo social media platform that it had detained a 54-year-old woman surnamed He and a 39-year-old woman surnamed Sun who was her employee at the Wailian Chuguo consultancy firm that helps people emigrate overseas.
Commentators said the move is a warning that the ruling Chinese Communist Party is acting on its concerns over the sheer number of its citizens wanting to live elsewhere, dubbed the “run” movement.
A day before the announcement, U.S.-based former ruling Chinese Communist Party school professor Cai Xia named the arrested company boss as He Mei in a tweet to her X account.
Cai cited inside sources as saying that police were demanding that He Mei hand over all of her customer records dating back decades.
“Any Chinese applying for a green card or who hold a U.S. passport and travel between China and the United States need to leave China immediately or don’t travel there for the time being, for their own safety,” she cited the sources as saying.
An employee who answered the phone at Wailian Chuguo confirmed that He Mei is the head of the company, but said it was business as usual on Thursday.
“I haven’t received any information about this report,” the employee said. “All our employees are at work and the company is open for business.”
Capital outflows targeted
Cai told Radio Free Asia in an interview on Thursday that the authorities are likely targeting the assets of Chinese nationals, both at home and overseas.
“When China gets ahold of this data, it will require people who live in both places to give up their property, or their overseas property,” Cai predicted.
“The Xi administration is strapped for cash, and everything it does is for financial reasons,” she said. “They are getting ready to close the door and stop people from leaving.”
“They’ve arrested the head of the biggest company, and then they’ll start going after all of the other immigration consultancies, big and small,” Cai said. “After that, nobody who is still inside China will be able to leave.”
Chinese financial expert He Jiangbing agreed, saying the authorities are slapping strict controls on capital outflows due to a lack of liquidity in the Chinese economy.
He said it’s part of decoupling the Chinese currency from international pressures, to ensure the stability of the exchange rate.
“This is a very clear signal that China wants an independent currency with a stable exchange rate,” he said. “It’s a huge backwards step on the road to free convertibility of the yuan.”
“They don’t want people exchanging it, and they don’t want it going overseas.”
According to the Shanghai police, He Mei and her employee Sun are accused of “providing intermediary services” starting in 2016 by collecting yuan assets from clients in China and handing over foreign currency when they arrive overseas.
They allegedly “illegally provided foreign exchange services for others,” the police said, saying the company had used “underground” banking networks to get their clients’ yuan assets out of China.
Translated by Luisetta Mudie.
