The New York Times uncovers Xiao Jianhua and Jack Ma's hidden network

On Monday, July 22, the New York Times published two reports revealing the secret business relationship between jailed Chinese businessman Xiao Jianhua and tech mogul Jack Ma. The reports indicate that Xiao, acting as a white glove for top Chinese Communist Party officials, facilitated asset transfers for the sister of Chinese leader Xi Jinping. According to reports, Xiao Jianhua has been investing in companies owned by Jack Ma through a network of shell companies and agents, without publicly disclosing these transactions. This approach is consistent with Xiao's usual operations, as he often acts as an intermediary for China's elites, including transferring assets for Xi Jinping's sister. In 2014, a spokesperson for Xiao confirmed that Xi Jinping's sister and brother-in-law had sold their 50% stake in a Beijing investment company to Xiao's Tomorrow Group. Jack Ma, who has been mostly out of the public eye, no longer holds official positions in his companies. The New York Times did not find direct evidence that Ma was aware of Xiao's investments. Alibaba also denied any business relationship between Ma and Xiao, disputing the factual basis of the investigation. However, the investigation revealed that Xiao controlled about one-third of the shares in Ma's security company Yunfeng Financial. Through several offshore companies, as well as a company held by Huang Youlong, husband of actress Zhao Wei, this made Xiao Jianhua a significant shareholder. Xiao disappeared from a Hong Kong hotel in 2017 during China's anti-corruption campaign. He was later sentenced to 13 years for bribery and corruption. Despite his imprisonment, his connections to Jack Ma's companies persisted. In 2020, for example, Xiao's Tomorrow Group still held a 0.1% stake in And Financial Group, valued at over $300 million. Based on the reports, it appears that Xiao's investments may have been aimed at benefiting China's elite rather than addressing genuine business needs. As of 2014, Jack Ma had also become a substantial financial resource for China's political elite, as companies owned or supervised by relatives of six current or former Politburo members had invested in his businesses.