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Wealth, Crime And Property Rights In A Booming China

The entrance of Chengu's Chunxi street
The entrance of Chengu's Chunxi street
Lan Rongjie*

CHENGDU — It's common practice in every country to confiscate property that criminals attained illegally. In China, criminal law stipulates three concrete measures: confiscation of the instruments of crime and contraband, recovery of illegal gains from criminals, and confiscation of the personal property of criminals who commit certain offenses.

It's worth recognizing that the law tries to deter criminals in every possible way by reclaiming "ill-gotten gains." The greatest controversy with regard to confiscating property often comes down to technical aspects and the actual definition of "illegal gains."

China’s criminal law interprets "illegal gains" as "all of the perpetrators' belongings obtained through illegal acts." Such a general statement almost inevitably leads to confusion in practice. For example, should this include property yields such as dividends and interest, or investments in real estate and company shares? And how is the criminal's own legitimate property, or property jointly owned with others, to be divided?

These questions not only relate to how much property should be confiscated, but they also affect the degree of conviction and penalty in cases such as smuggling. But so far in China, it is all largely left to the discretion of the authorities handling the cases.

Of course, it is impossible for legislators to foresee everything in advance, and law enforcement discretion can never be fully avoided. But China has a particular problem: Far too often the authorities handling the cases enrich themselves in the process of confiscating assets.

One principle that is often brushed aside is that confiscation revenue should be separated from the expenditure accounts of law enforcement agencies. It is common for financial departments to return a portion of confiscated properties to the authority handling the case, and certain individual local law enforcement officials even profit directly from what they have obtained, sometimes helping themselves to forfeited vehicles or houses.

Original sin

The mentality in many public offices is to simply take as much advantage as possible, which is often explained away by tight budgets and pressure to find new revenue sources. The Chongqing gang trials aimed at private entrepreneurs a few years ago largely resulted from this mentality.

China's rapid economic development over the past 30 years has produced a large number of successful businessmen and a growing affluent class. Some, we know, didn't gain wealth in a totally clean way.

The so-called "original sin of the rich," the practice of utilizing public resources to accumulate wealth quickly, thus becomes their unavoidable historical stain even if later success is clean.

It is true that political and legal authorities have tremendous power to take away what people own in China, but it is also true that "original sin" indeed exists far too often with the rich, private entrepreneurs. So once the political and legal authorities have a strong profit motive, property owners are inevitably subject to aggressive prosecution and confiscation.

Improvements include increased clarity about which public office is handling property confiscation, as well as new legislation to refine the definition of "illegal gains" and "personal assets."

In short, confiscation should remain a strong deterrent to illicit behavior by China's wealthy or would-be wealthy. But even criminals deserve property rights. Every penny should be confiscated if it is legally justified, yet not even a single extra cent should be taken when it's not.

*Lan Rongjie is an associate professor of the School of Law at China's Southwestern University of Finance and Economics.

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Big Brother For The People: India's CCTV Strategy For Cracking Down On Police Abuse

"There is nothing fashionable about installing so many cameras in and outside one’s house," says a lawyer from a Muslim community. And yet, doing this has helped members of the community prove unfair police action against them.

A woman is walking in the distance while a person holds a military-style gun close up

Survellance and tight security at the Lal Chowk area in Srinagar, Jammu and Kashmir, India on October 4, 2022

Sukanya Shantha

MUMBAI — When sleuths of the National Investigating Agency suddenly descended on human rights defender and school teacher Abdul Wahid Shaikh’s house on October 11, he knew exactly what he needed to do next.

He had been monitoring the three CCTVs that are installed on the front and the rear of his house — a chawl in Vikhroli, a densely populated area in suburban Mumbai. The cameras told him that a group of men and women — some dressed in Mumbai police’s uniform and a few in civil clothes — had converged outside his house. Some of them were armed and few others with batons were aggressively banging at the door asking him to immediately let them in.

This was not the first time that the police had landed at his place at 5 am.

When the policemen discovered the CCTV cameras outside his house, they began hitting it with their batons, destroying one of them mounted right over the door. This action was captured by the adjacent CCTV camera. Shaikh, holed up in his house with his wife and two children, kept pleading with the police to stop destroying his property and simply show them an official notice.

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