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China Evergrande Group founder, Hui Ka Yan, is facing hefty fines from the country’s securities regulators for financial fraud and collusion to inflate the company’s revenues by a significant amount. The fines total $6.6 million for Hui and $580 million for Evergrande Real Estate Group, the main unit of the company in China. The China Securities Regulatory Commission (CSRC) concluded that under Hui’s leadership, the company falsely boosted its revenues for the years 2019 and 2020 by improperly recognizing revenues in advance. This led to defrauding investors and raising $2.9 billion through issuing bonds in onshore markets from 2020 to 2021.

In addition to the fines, Hui and former CEO Xia Haijun will be banned from trading Chinese securities for life. Shen Meng, managing director of Beijing-based investment bank Chanson & Co., believes that more penalties will be imposed on Evergrande and Hui in the future. Evergrande, once the richest man in Asia, symbolizes a debt-fueled expansion that resulted in the company borrowing from financial institutions and its own employees. As debt levels rose and authorities cracked down on risks, Evergrande struggled to repay its borrowings and eventually collapsed under more than $300 billion in liabilities.

Hui’s net worth has drastically decreased from $36 billion to $700 million, according to Forbes’ estimates. The disgraced tycoon has been out of the public eye since September, when it was reported that he was suspected of crimes. The Hong Kong court has approved the liquidation of China Evergrande Group, and liquidators have been appointed to determine how its assets can be used to pay back creditors. In China, the company still has unfinished apartment projects that need to be completed, and there have been reports of staff detainment at its wealth management unit.

As Evergrande continues to face legal and financial challenges, investors are left in the dark about Hui’s current whereabouts. The company’s ambitious plans to enter the electric car market have also hit roadblocks, with reports of detained executives and ongoing investigations into the sale of wealth management products. The future of Evergrande remains uncertain as it navigates through a series of crises and works towards resolving its massive debt burden.

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