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society

Hukou Fraud

Invisible Billionaires A spate of scandals regarding the hidden real estate of government officials and executives of State banks, allegedly purchased using false identification, has caused a public backlash By Yu Xiaodong

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s far as most ordinary Chinese people are concerned, the hukou, the country’s household registration system, is infamously rigid. Dividing the population into urban and rural residents, it serves as a platform for the issuance of identity cards and passports, entitlement to public services, and a major tool in the enforcement of the One Child Policy, requiring a long list of documents and various lengthy procedures to either register a newborn or to relocate. Given the system’s controversial nature, it is no surprise that a series of hukou fraud scandals in recent months, mostly involving government officials and State-owned enterprise executives with large real estate holdings incongruous with their official salaries, have infuriated the public.

ID Fraud

Among the dozen or so cases to have come to light recently is that of Zhai Zhenfeng, former director of the real estate bureau of Erqi district in Zhengzhou, capital of Henan Province. Following rumors on Weibo, China’s Twitter, an official investigation found that four of Zhai’s family members had two separate hukous and national ID cards each. While official records showed that Zhai himself did not own any real estate, a total of 29 properties were found under the IDs of his wife, adult son and daughter. Zhai is also accused of granting the majority of government real estate development contracts issued during his tenure to a company owned by his wife.

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Other cases include Zhang Yan, the wife of a police officer and herself an anti-corruption official in Shanxi Province, who was found to have two hukou and two IDs, and to be in possession of more than a dozen real estate properties. In Guangdong Province, Zhao Haibin, a township government official, was found to have acquired 192 properties with two different IDs, an astonishing number given his comparatively low position and official salary. In north-eastern Heilongjiang province, Zhang Xiuting, a senior anti-corruption official, was found to have bought 14 houses in his wife’s name and then divorced her, apparently to hide his paper trail. By far the most sensational case is that of 49-year-old Gong Aiai, an executive at the State-owned Agricultural Bank of China in Shenmu, a coal-rich county in Shaanxi Province. Nicknamed “house sister” by netizens, Gong was found to have four hukou attached to four different IDs in three provinces, including one in Beijing, where she owns 41 properties reportedly totaling over 1 billion yuan (US$160 million), along with millions of yuan of investment in various enterprises. While Gong argued that her assets came from proceeds from her “family businesses,” it is suspected that her wealth was mainly the spoils of her role as an executive of a State bank with deep ties to the booming coal industry. Coming at a time when China’s new leader Xi Jinping has heavily ramped up anti-corruption measures since taking the reins of the Communist Party last November, the scandals have provoked a strong public backlash. CHINA WEEKLY I March 2013

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