US, China to discuss repatriation of Chinese fugitives

Los Angeles

SENIOR US officials will meet their Chinese counterparts in August to discuss the possibility of repatriating Chinese officials who have fled to America with billions of dollars of allegedly stolen government assets, a US official said.

The issue is a thorny one, as no extradition treaty exists between the United States and China.

That has made America, and other countries such as Australia and Canada, attractive destinations for Chinese officials fleeing the country and a haven for stolen assets.

Western governments have long been reluctant to hand over suspects because of a lack of transparency and due process in China's judicial system. International human rights groups say torture is used as a tool for extracting confessions in Chinese interrogations. Government officials convicted of corruption have been sentenced to death.

Officials from both countries met for two days in the Philippines last month, with the US delegation led by David Luna, the US State Depart-ment's senior director for National Security and Diplomacy.

Mr Luna confirmed to Reuters that he attended the meetings and said talks will reconvene in August and will include law-enforcement and legal experts. The countries will share specific intelligence on suspected corrupt Chinese officials and stolen assets and will also discuss ways to send fugitives back to China.

The Chinese Foreign Ministry said there was a need for new steps to be agreed with the US to enable the recovery of stolen assets.

"We are willing to stay in communication with the United States on this," ministry spokeswoman Hua Chunying said in Beijing.

Alternatives to extradition exist, US officials say, including deportation for violations of US immigration law.

Canada, which has no formal extradition treaty with China, has recently expelled suspects wanted by Beijing, including Lai Changxing.

Lai, a businessman wanted for corruption, was sent back to China from Canada in 2011 on the promise that he would not be executed. He was sentenced to life in prison.

Last year, Chinese officials said more than 150 "economic fugitives", many of them described as corrupt government officials, were in the US.

Neither country has publicly provided a figure for how much stolen money has been smuggled from China to the US.

But the Washington-based Global Financial Integrity group, which tracks illegal flows, estimates that between 2003 and 2012, US$1.25 trillion of illicit cash left China.

Some of that moves around the world through dummy bank accounts and other means, and once in the US, it is often invested in real estate, making its source hard to trace.

The preliminary talks between US and Chinese officials were held on Jan 27-28 in Clark, Philippines as part of an Asia-Pacific Economic Cooperation (Apec) working group, called ACT-NET. The group, which involves multiple Apec countries, including Russia, was formed in Beijing in August to fight cross-border corruption.

The talks took place amid an intensifying and far-reaching anti-corruption drive in China, and a ramping up of efforts between the US and China, including the sharing of criminal intelligence, to crack down on cross-border corruption.

It was agreed after the talks that more formal negotiations within the ACT-NET forum will take place in August in the Philippines, which chairs Apec for 2015. The US delegation will likely include officials from the State Department, the Department of Justice and the Department of Homeland Security, Mr Luna said.

Mr Luna said law-enforcement officials from both countries will discuss cases and possible joint investigations into Chinese fugitives and stolen assets.

"There are alternatives to extradition," Mr Luna said. He said legal avenues being explored to circumvent the lack of an extradition treaty between the US and China include UN conventions against corruption and on transnational organised crime.

He said there is no formal agreement to return stolen assets to China, but the issue is "part of an ongoing bilateral dialogue, there are ongoing cases, and it is a priority". REUTERS