From Chinese detainee to Cambodian diplomat: the radical rebirth of Wang Yaohui

[geovalin]

Businessman with checkered past has financial ties to Cambodian power couple with holdings in Singapore.

 

Wang Yaohui has taken an unconventional career path for a Cambodian diplomat.

For one thing, he was born in China and lived there for most of his life. For another, he has a very checkered past in the business world, tainted by bribery scandals over a copper mine in Zambia and a state-run bank in China for which he was detained and an associate was sentenced to life in prison.

 

But following a path well-trodden by other Chinese tycoons with reputational problems, Wang used connections among the Cambodian elite to land himself a new nationality, a new name and a new career. Using his adopted Khmer name, Wan Sokha, he rapidly became an “advisor” to Prime Minister Hun Sen and landed a plum post at Cambodia’s embassy in Singapore, a position he still holds.

 

That diplomatic posting has not prevented him from furthering his business interests. Untangling the web of those interests which stretch from Asia to Europe is no easy task. Wang has gone to great lengths to conceal his enormous but undeclared commercial footprint.

 

A key piece in this complex puzzle are the Singaporean holdings of a Cambodian power couple: Sen. Lau Ming Kan and his wife Choeung Sopheap, who has been instrumental in Wang’s progress. This story explores those ties, using documentary evidence and also flight manifests from aircraft owned by Wang. It is part of a wide-ranging RFA investigation into more than $230 million in financial and property interests that figures linked to Cambodia’s ruling party have in the prosperous city state of Singapore.

 

The documents not only show how Sopheap helped transform Wang from a fugitive to an accredited Cambodian diplomat. They also show how Wang has become the apparent beneficial owner of an energy company granted an exclusive 10-year license to import liquified natural gas by the Cambodian government.

 

The documents also show that Wang has concealed from the Hong Kong Stock Exchange and the English Football League his substantial stake in a major English soccer team, Birmingham City Football Club. That is potentially a criminal offence, punishable by up to two years in prison.

Additionally, the documents shed light on how Sopheap has been embroiled in a real estate deal in Cyprus involving Wang that is the subject of a European police investigation.

 

Mired in mining scandal

  Wang was born in June 1966 in Heilongjiang, China’s northernmost province bordering Russia, soon after the start of the Cultural Revolution, which saw millions die as the Communist Party sought to purge society of traditional and capitalist elements.

 

That’s in stark contrast to the dynamics of Wang’s adult life which associates say has been spent in single-minded pursuit of money.

From the late 1990s onwards, his zest for profits saw him invest in everything from African mining operations to the Chinese art market and he did so with gusto. By the end of each venture, however, his business partners almost invariably felt that they had been wronged.

 

A truck leaves the Chibuluma copper mine after collecting ore from 1,693 feet (516 meters) below the surface in the Zambian copper belt region, Jan. 17, 2015. (Reuters)

In 2009, Wang signed an agreement with the government of Zambia on behalf of his Zhonghui Mining Group, pledging to invest $3.6 billion in a copper mine in the central African nation. The deal – which was hailed by Zambia’s then-President Rupiah Banda as a “positive development” – would quickly come undone, according to By All Means Necessary: How China's Resource Quest is Changing the World, a 2013 book by Elizabeth Economy and Michael Levi, who would go on to be a special assistant to U.S. President Barack Obama.

 

Economy and Levi recount how in 2011 Zhonghui “began building the mine without conducting an environmental impact assessment, violating Zambia’s 1997 EIA regulations.” The year also saw a new party take power in Zambia, which set about scrutinizing land and mining deals overseen by its predecessors.

 

While the move was viewed by the government’s supporters as a marker of improved governance, others “believed that the new administration simply wanted to nullify previous deals to reap its own payments and bribes as the various concessions were sold anew.”

 

Zhonghui was ordered to stop work immediately pending its production of an EIA. The company failed to do so and was charged alongside Zambia’s former minister of mines and minerals with corruption.

 

The government alleged that Zhonghui had paid close to $60,000 of Zambian customs duties for 5,000 bicycles the minister had imported from China in 2011. Reuters reported that prosecution witnesses, “testified that with the minister’s influence, the Chinese firm was awarded the licenses within three days when such a process normally lasted months.”

 

The minister was found guilty in 2015 and sentenced to one year in jail with hard labor (although in 2019 he received a presidential pardon). The court ruled Zhonghui had no case to answer. But by that time, Wang had bigger problems closer to home.

 

A bribes for loans scandal

In June 2012, the South China Morning Post reported that Wang had been detained late the previous month in Beijing by the Central Commission for Discipline Inspection, the Chinese Communist Party’s anti-corruption watchdog. Citing unnamed sources, the newspaper claimed the party was investigating allegations of “bribery and money laundering” within a “complex network run by low-profile but well-connected businessman Wang Yaohui.”

 

Photograph of Wang widely distributed around the time of Agricultural Bank of China Vice President Yang Kun’s arrest for allegedly receiving bribes from Wang. (Photo: Supplied by source)

 

In particular, the authorities were examining Wang’s relationship with Yang Kun, the vice-president of the state-owned Agricultural Bank of China. Sources told the South China Morning Post that together Wang and Yang had “lost several hundred million yuan during their gambling trips to Macau.” Moreover, the sources added, Yang had overseen loans from the bank to one of Wang’s companies, putatively intended to support property development, but which, “may have been misused to cover gambling losses in Macau.”

 

Yang was eventually hit with corruption charges, among them that he took 4.138 million yuan ($630,000) in bribes from Wang between 2008 and 2010 and that in return he facilitated 1.45 billion yuan ($220 million) in loans from Agricultural Bank of China to Wang’s company. Yang contended at trial that the loans were offered on merit, but nonetheless pled guilty to all charges and was sentenced to life imprisonment.

 

A new life – and name – in Cambodia

Wang, meanwhile, went uncharged. By the time Yang was handed his punishment in February 2015, Wang had been a naturalized Cambodian citizen for 11 months. He took a Khmer name, Wan Sokha, set up myriad businesses, and by July of the same year had been appointed a personal advisor to Prime Minister Hun Sen.

 

The role came with a diplomatic passport. Issued in August 2015, the document describes Wang as an “Advisor to the Prime Minister” and gives his emergency contact as Cheung Sopheap, a frequently used alternative spelling of the name of senator’s wife, prime minister’s confidante, and business tycoon in her own right, Choeung Sopheap.

Wang Yaohui’s 2014 certificate of naturalization as a Cambodian citizen. The highlighted sections reads: "To grant Khmer naturalization to Mr. Wang Yaohui, Chinese origin, Chinese national, born June 11, 1966, in Heilongjiang province, PRC." (Photo: Cambodian Royal Gazette)

How an individual with as checkered a past as Wang’s found himself an advisor to Hun Sen is unclear. So, too, is the question of how Sopheap came to be listed as the emergency contact on his diplomatic passport. However, Wang and the tycoon were soon to have overlapping interests both in Cambodia and as far afield as Europe.

 

In May 2015, as Yang Kun would have been entering his third month of imprisonment, a new company was incorporated on the European island nation of Cyprus. Named JWPegasus Ltd, the company was established as an investment vehicle for the construction of a Radisson Blu hotel in the coastal city of Larnaca.

 

A 2019 investigation by Reuters revealed that among the shareholders were Sopheap, two of her children, and Im Paulika, the wife of Cambodian Finance Minister Aun Pornmoniroth. The news agency also obtained Cypriot Interior Ministry documents showing that all four were granted Cypriot citizenship following the investment, as were Finance Minister Pornmoniroth and Sen. Lau Ming Kan.

 

Three out of the first four investors in JWPegasus, who joined the project in August 2016, were associates of Wang. Lay Virak was born in China and known as Yu Teng until he became a naturalized Cambodian citizen in February 2015. Cambodian business records show he shares a residential address with other individuals involved in the management of companies linked to Wang. Another investor, Tang Yuhong, was Wang’s longtime romantic partner and the co-owner of mansions he owns in California. The third investor, Li Xiaohua, has since 2014 been a minority shareholder and co-director of a Singaporean company majority owned by Wang’s partner Tang.

 

The following month, in September 2016, Sopheap and her daughter Lau Sok Huy took shares in JWPegasus. The same month a set of notices appeared in the Haravgi  newspaper in Cyprus announcing that several individuals had submitted their applications for Cypriot citizenship to the Interior Ministry. Among the names listed were: Li Xiaohua, Wang Yaohui, Lay Virak, Lau Sok Huy, Choeung Sopheap, Pich Aphirak (Lau Sok Huy’s husband), Tang Yuhong, and Lau Ming Kan. All were either investors in JWPegasus or the spouse of an investor.

Cambodian ruling party senator Lau Ming Kan’s Cypriot passport, granted following his wife Choeung Sopheap’s multimillion dollar investment in the construction of a hotel on the island nation, whose police force is currently investigating the transaction. (Photo: Supplied by source)

RFA has been able to independently confirm that Wang, Tang, Sopheap and Lau Ming Kan had all received Cypriot passports by February 2017. Flight manifests obtained by RFA show that Sopheap and Ming Kan were passengers on planes owned by Wang at least five times in 2017 and 2018, variously using both their Cambodian and Cypriot passports.

 

By this point, Wang was no longer merely an advisor to Hun Sen. In January 2016 he had been issued a new diplomatic passport. This one no longer bore Sopheap’s name and phone number, but it did announce a new job for Wang: minister-counselor at the Cambodian embassy in Singapore.

 

Diplomatic immunity and corporate disguises

In 2017, Wang took an unusual step for a diplomat – he caused at least two companies to be established in Singapore. While not expressly forbidden by international law, it is generally frowned upon for diplomats to have private commercial interests in their host country.

 

Wang’s name does not appear anywhere on the documents lodged with the Singaporean business registry in connection with the companies. However, documents obtained by RFA show that he is the outright – if undeclared – owner of one (Gold Star Aviation Pte Ltd) and has a significant, likely controlling, interest in the other – Asia Pacific Energy Holdings (Singapore) Pte Ltd.

 

Gold Star Aviation is the owner and operator of private jets. Its sole shareholder is a British Virgin Islands company called Dragon Villa Limited and its only director is a Singaporean citizen named Leong Chee Kong, or Ben. However, affidavits lodged with the Singapore High Court reveal that the true owner of Dragon Villa is in fact Wang.

 

One of the affidavits was submitted by Jenny Shao, a Taiwanese-American dual citizen who describes herself as Dragon Villa’s “authorized signatory.” (Shao was also identified by Wang’s lawyers as his attorney-in-fact – meaning a person authorized to act by a power of attorney - during a 2010 court battle between Wang and Farro Essalat, a prestigious Californian architect who had sued for unpaid fees after he was hired to design one of Wang and Tang’s two luxury homes on the outskirts of San Francisco).

 

In her affidavit, dated October 2020, Shao writes that Dragon Villa “is beneficially owned by Mr. Wang.” A beneficial owner is a person who enjoys the benefits of owning a company which is in someone else’s name.

 

The claim is echoed in affidavits submitted by a former Gold Star Aviation employee named Mohideen Abdul Kader, who recounted Shao claiming that “she handled all his business matters under a company called Dragon Villa.”

 

Gianluca Zanigni, a former Gold Star Aviation pilot, also submitted an affidavit suggesting that the company was run by Shao on behalf of Wang. Both his and Kader’s affidavits described Kong – the company’s sole listed director – as Wang’s personal driver.

 

The second company that Wang is linked to in Singapore, Asia Pacific Energy Holdings, acts as corporate parent to Cambodian Natural Gas Corp Ltd, a Phnom Penh-registered company that, according to its website, has been granted a 10-year monopoly on the import and distribution of liquified natural gas in Cambodia.

 

“One of the company's shareholders has a deep Cambodian government background,” the company’s website notes. “With this strong shareholder protection provides even a stronger guarantee for the company to obtain various policy support.”

 

That shareholder would appear to Sopheap, who owns 40 percent of Asia Pacific Energy Holdings’ shares. The remaining 60 percent are held by an anonymous British Virgin Islands shell company called Smart City Investments Ltd.

 

While the beneficial owner of Smart City Investments has not been publicly disclosed, there are several indications that Wang has an interest in it. For one, his alleged chauffeur Kong is listed as a director of Asia Pacific Energy Holdings. Kong also signed Asia Pacific Energy Holdings official minutes in his capacity as “a joint corporate representative of Smart City Investment Ltd.” His Gold Star Aviation email address was also given as the contact information for Sopheap as a shareholder in Asia Pacific Energy Holdings.

 

Asia Pacific Energy Holdings’ accounts also provide clues to Wang’s involvement. They record two loans to the company totaling $22.8 million. The first loan, of $3.2 million, comes from a Cambodian company, Graticity Real Estate Development Co Ltd, whose sole shareholder and director was Wang (using his Khmer name Wan Sokha) from June 2014 until two days after Asia Pacific Energy Holdings was established in May 2017.

 

The second loan, valued at $19.6 million, came from a British Virgin Islands company called Well Faith Shipping Co Ltd. Well Faith Shipping is the owner of a $23.6 million London home, whose address is listed in Cypriot corporate filings by JWPegasus as that of Wang’s partner Tang, and that a source familiar with the matter has described as Wang’s primary residence in the United Kingdom.

 

Cambodian Natural Gas Corp’s primary supplier is the state-owned China National Offshore Oil Corporation. In 2019, CNOOC issued a press release identifying Wang as a “senior executive” with Cambodian Natural Gas Corp representing the company in a meeting with Communist Party officials in Beijing to discuss potential projects in Cambodia’s nascent natural gas sector.

Wang Yaohui sits with the delegation of the Cambodian Natural Gas Corp at a Nov. 25, 2019, meeting with the state-owned China National Offshore Oil Corporation in Beijing. (CNOOC website)

The press release appears to suggest not only that Wang is associated with Cambodian Natural Gas Corp, but that whatever tensions the Yang Kun case might have produced between Wang and his homeland’s government have thawed.

 

Taking a slice of the beautiful game

It is unclear precisely how Wang went from seemingly being persona non grata in his homeland to becoming a guest and business partner of a Chinese state-owned corporation. He had, however, covertly acquired himself a slice of the president’s favorite sport.

 

Since his elevation in 2009, Chinese President Xi Jinping has made no secret of his dream of a world-class Chinese national soccer team. In 2014, self-professed Manchester United fan Xi announced a 50-point plan for Chinese soccer greatness, including the construction of tens of thousands of soccer schools across the country. Well-heeled Chinese entrepreneurs took their cue and set about buying up top-flight European clubs.

 

The shopping spree lasted until mid-2017, according to a 2021 report by sports business news site Sportico, when the Chinese government “decided the country’s domestic football program wasn’t reaping enough benefits from all of the investment,” and set about encouraging the repatriation of investments in overseas clubs.

St Andrew's, the home stadium of Birmingham City Football Club, in a file photo taken Jan. 22, 2022. (Action Images/Reuters)

Wang was clearly undeterred, however, and in late 2017 set about acquiring a stake in Birmingham City Football Club, a soccer club in the English Football League’s Championship, the country’s second-highest tier. True to form, though, he did so in such a way that his name appeared nowhere in connection with it.

 

The club is majority-owned by a company registered in the Cayman Islands called Birmingham Sports Holdings Ltd, whose shares are traded on the Hong Kong Stock Exchange.

 

On the morning of Sept. 27, 2017, RFA has learned that Birmingham Sports Holdings CEO Huang Dongfeng and Wang boarded the latter’s private jet at Phnom Penh airport, touching down in Hong Kong three and a half hours later.

 

Exactly two months later, on Nov. 27, a company registered in the British Virgin Islands called Ever Depot Limited bought $39 million of shares in the club’s Hong Kong-listed parent company, Birmingham Sports Holdings Ltd, giving it control of 24.9 percent of its stock.

 

A filing with the Hong Kong Stock Exchange announcing the purchase states Ever Depot is owned by Graticity Real Estate Development – the Cambodian company that loaned Asia Pacific Energy Holdings $3.2 million. The filing describes Graticity Real Estate Development’s beneficial owner as Vong Pech, who took control of the company when Wang resigned his directorship and disposed of his shareholding in May 2017.

 

Born in China in 1976, Vong was known as Wang Dong prior to becoming a naturalized Cambodian citizen in 2015, according to a notice in the Cambodian Royal Gazette. Two sources familiar with the matter described Vong as a close relative of Wang Yaohui who frequently fronts ownership of companies and assets for him.

Pictured (top) on the tarmac at Zurich Airport, Wang Yaohui’s Boeing 737 private jet, in which he gave rides to senior Birmingham Sports Holdings executives as well as Lau Ming Kan, Choeung Sopheap and their extended family. Also pictured (below) the jet's plush interior. (Exterior photo: Flick/Alec Wilson; interior photos: Photos supplied by source)

The next month, on Dec. 14, Dragon Villa Limited spent $12.7 million on shares representing 8.54 percent of Birmingham Sports Holdings’ total stock. The following day, a man with the same name, age and nationality as Birmingham Sports Holdings executive director Hsiao Charng-Geng hitched a ride on Wang’s private jet from Hanoi, Vietnam, to Phnom Penh, according to a copy of the flight manifest obtained by RFA. Also on the flight was Vong Pech. The following March, flight records show Hsiao and Wang flew aboard the same plane from Ho Chi Minh City to Phnom Penh.

 

A notice to the Hong Kong Stock Exchange announcing the sale identified a man named Lei Sutong as Dragon Villa’s beneficial owner. However, Lei would appear to be a nominee owner acting on behalf of Wang. Not only does Wang’s attorney-in-fact Shao’s 2020 affidavit identify Wang as the beneficial owner of Dragon Villa; it also identifies him as the beneficial owner of a Samoan company called Peace Crown Limited. A document signed and sealed by Peace Crown’s resident agents in Samoa dated April 2017 identifies Lei as the sole director and shareholder of Peace Crown.

 

The recurring discrepancy between the stated ownership and beneficial ownership of companies connected to Wang gives credence to a claim made repeatedly to RFA by sources familiar with his business practices. Namely, that he habitually appoints others to represent his interests in companies he controls but does not want to be linked to in official records.

 

Proxy directors and shareholders are viewed as legitimate corporate tools in many jurisdictions. However, it appears that on this occasion Wang’s use of them may have strayed into the realm of illegality.

 

The Hong Kong Stock Exchange requires anybody with an interest in five percent or more in a listed company to declare that interest publicly. It is possible – although unlikely – that Lei was indeed the beneficial owner of Dragon Villa when in December 2017 it acquired 8.54 percent of Birmingham Sports Holdings. But we know from the affidavit of Shao – Wang’s attorney-in-fact for at least the past 13 years – that by 2020 the true owner was Wang. Even if Wang was not the beneficial owner in 2017, he was legally obliged to publicly announce his interest in Birmingham Sports Holdings within three days of becoming Dragon Villa’s owner.

 

Under Hong Kong’s Securities and Futures Ordinance, it is a criminal offence to provide a false or misleading statement to the city’s stock exchange, punishable by up to two years in prison.

 

As of publication, Dragon Villa and Graticity Real Estate Development respectively owned 17.08 and 25.53 percent of Birmingham City Holdings, making Wang and his family the single largest ownership bloc among shareholders in the club’s holding company.

Comment was sought from Birmingham Sports Holdings on its apparent failure to comply with Hong Kong's Securities and Futures Ordinance by failing to disclose Wang's status as a substantial shareholder in the company. A company representative responded with an email that did not address any of the issues raised by RFA.

"We appreciate your support to our Group and Birmingham City Football Club," the representative wrote in a somewhat unusual response to allegations of what could potentially amount to criminal misconduct.

 

Police on trail of ‘Power Couple’

Meanwhile, in Cyprus, Wang’s Cambodian co-investors in JWPegasus -- the company set up as an investment vehicle for a Radisson Blu hotel construction project -- have legal problems of their own.

 

Police are investigating the circumstances surrounding Sopheap and her senator husband’s obtaining citizenship of the island nation, which is an EU member state.

A person riding a scooter passes an advertisement near Paphos, Cyprus October 12, 2019. (Reuters)

A March 10 judgement of the Supreme Court of Cyprus contains details of an affidavit lodged by the police in support of an application for a warrant to search a lawyer’s office in connection with the investigation. While the judgement only makes use of the initials “SC,” other identifying details within the text indicate that those letters stand for “Sopheap Choeung.”

 

“It was found that a person from Cambodia, SC, secured naturalization with false representations as an investor, as well as her husband as a dependent family member,” the judgement reads.

 

In 2016, it continued, “SC” made the investment underlying their citizenship application through 25 bank card payments totaling 3.2 million euros ($3.5 million), noting that: “According to a statement from a Central Bank official, the use of bank cards for the transfer to Cyprus of amounts of € 2,000,000 and € 3,000,000 within a few minutes indicates a suspicious transaction.”

 

In essence, the police believe that Sopheap moved the money via credit card rather than wire transfer so as to avoid the scrutiny that a Cypriot bank would be legally required to perform on a transaction of that size.

 

“In submitting their application, these persons concealed a substantial fact, such as that their business activities in Cambodia resulted in the suspension of funding for their country by the World Bank,” it added, in an obvious reference to the couple’s Shukaku property development firm, whose filling in of Phnom Penh’s Boeung Kok Lake and –often violent – eviction of nearby residents drew international ire and the World Bank blacklisting.

 

In a curious coincidence, Graticity Real Estate Development – the firm formerly chaired by Wang, and which owns 25.53 percent of Birmingham Sports Holdings – was the first company to begin construction in 2015 on the land cleared by Shukaku. In a further twist, Graticity Real Estate Development has leased 1,200 meters[MP2]  of the development to Birmingham Sports Holdings.

 

While the nesting layers of transactions and shell companies may be confusing, they add up to a few simple facts. Firstly, that Wang’s fortunes are intimately bound up with those of Sopheap and her family. Secondly, that Wang has a vast, undeclared commercial footprint, not only in Cambodia but across Asia and Europe.

 

Wang’s aversion to transparency coupled with his being linked to at least two major corruption scandals raises important questions about the openness of Cambodia’s leadership to mysterious men bearing money of opaque origin, and the influence it allows those men to buy in the Kingdom.

 

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