Ask Onix
Evergrande founder admits guilt in Shenzhen court
Hui Ka Yan, the founder of China's beleaguered property giant Evergrande, pleaded guilty to embezzlement and corporate bribery during a public hearing in Shenzhen on April 13 and 14, state media reported.
The court has yet to announce a verdict, but Hui expressed remorse during the proceedings, according to official statements.
Collapse of a property empire
Evergrande, once China's largest real estate developer with a market valuation exceeding $50 billion, spiraled into crisis in 2021 after amassing over $300 billion in debt. Its downfall sent shockwaves through China's property sector, leaving investors and domestic banks grappling with the fallout.
The court revealed that the company misused millions in pre-sale funds from homebuyers, diverting them to new projects instead of completing existing ones. This left hundreds of developments unfinished across China.
From rural roots to financial ruin
Born Xu Jiayin, Hui rose from modest beginnings in rural China to become one of Asia's wealthiest individuals, with a peak fortune of $42.5 billion in 2017, according to Forbes. He founded Evergrande in 1996, capitalizing on China's economic boom fueled by heavy borrowing.
The company's rapid expansion extended beyond real estate into electric vehicles, food and beverages, and even a majority stake in Guangzhou FC, which became China's top football club.
Regulatory crackdown and financial penalties
Evergrande's troubles deepened in 2020 when Beijing introduced stricter rules to curb property debt. Forced to sell assets at steep discounts to stay afloat, the company's market value plummeted by 99% before its shares were delisted from the Hong Kong exchange in August 2025.
In March 2024, Hui was fined $6.5 million and barred from China's capital markets for life after regulators found Evergrande had inflated its revenue by $78 billion.
Broader economic impact
At its peak, Evergrande had 1,300 projects underway across 280 Chinese cities. Its collapse is widely seen as a catalyst for the country's prolonged property market downturn, which has strained economic growth.
The case underscores the risks of China's debt-driven development model and the government's efforts to rein in financial excesses in the sector.
