Anbang boss accused of defrauding billions at trial

A Chinese court accused Wu Xiaohui, the former head of Anbang Insurance Group, of defrauding more than $10 billion as it opened his fraud trial one month after authorities seized control of the conglomerate.

Wu’s trial began Wednesday morning at the Shanghai No. 1 Intermediate People’s Court, where prosecutors accused Wu of defrauding Anbang of 65.25 billion yuan ($10.4 billion).

The funds were transferred to companies he personally controlled for investment overseas, to pay down debts, or “personally squandered,” the court said on its Sina Weibo account.

The court also was told that Anbang had sold investment products that exceeded allowable fund-raising amounts by 723.9 billion yuan.

“Wu Xiaohui said that he did not understand the law and did not know that these actions constituted crimes,” the court said.

China’s insurance regulator announced a takeover of Anbang in February, saying Wu would be prosecuted.

The move was made to maintain normal operations at the company and protect consumers’ rights, according to a statement of the China Insurance Regulatory Commission. “Illegal business practices by Anbang Insurance Group may seriously threaten the solvency of the company,” said the statement.

Under Wu, Anbang led high-profile mergers and acquisitions overseas, including the 2014 purchase of the Waldorf Astoria Hotel in New York for $1.95 billion and Strategic Hotels & Resorts for $6.5 billion in 2016, CGTN reported.