Evergrande Founder Xu Jiayin Sentenced to Life in Prison, Closing the Criminal Chapter of China's Biggest Property Collapse
Xu Jiayin, the founder of China Evergrande Group, has been sentenced to life in prison with all personal property confiscated, closing the criminal chapter of the country's most consequential real estate collapse. The Shenzhen Intermediate People's Court delivered the sentence after Xu, also known as Hui Ka Yan, pleaded guilty in April 2026 to multiple charges including embezzlement of assets, corporate bribery, misuse of funds, fundraising fraud, and illegally taking public deposits (BBC; Reuters).
The court heard during the April proceedings that Evergrande had taken millions of dollars in pre-sale funding from prospective homebuyers that was never used for construction. Instead, the funds were channelled into new property developments, leaving behind hundreds of unfinished residential projects across China (BBC). Xu pleaded guilty to eight charges in total and expressed remorse during his court appearance (Reuters; Taipei Times). Life imprisonment and confiscation of property are the maximum penalties available for illegal fundraising under Chinese law (The Guardian; Reuters).
The court also imposed corporate-level penalties. Evergrande Group itself was fined 8.82 billion yuan (£960m; $1.31bn), and the company's real estate unit was ordered to pay an additional 7 billion yuan, according to state media (BBC).
The trajectory from peak to criminal conviction spans three decades. Xu founded Evergrande in 1996. The company grew to become China's biggest real estate developer, at one point carrying a stock market valuation exceeding $50bn. Xu himself was once estimated to be Asia's richest person (BBC).
The turning point came in 2020, when Beijing introduced measures to control debt in China's property sector. Those policies curtailed the borrowing model that had fuelled Evergrande's expansion and dealt a major blow to the company. Evergrande collapsed in 2021. Its stock market valuation shrank by 99% before its shares were delisted from the Hong Kong exchange in August 2025, ending more than fifteen years of trading (BBC).
The broader context here is the regulatory and political environment in which this sentence was delivered. The 2020 debt-control measures, widely known as the "three red lines," were designed to force overleveraged developers to reduce borrowing. Overleveraged simply means carrying debt far beyond what a company can safely manage. Evergrande's reliance on pre-sale receipts to fund new projects rather than complete existing ones was not unique to the company, but the scale was. The court's findings that pre-sale funds were systematically diverted from construction to land acquisition created the hundreds of unfinished housing complexes that became the visible human cost of the collapse.
The severity of the sentence, hitting the statutory maximum for illegal fundraising, signals how Chinese authorities intend to frame accountability for the property sector's debt crisis. Xu's plea and the concurrent corporate fines place the legal consequences at the intersection of white-collar criminal prosecution and systemic financial failure. For foreign investors and bondholders who absorbed losses across Evergrande's offshore debt restructuring, the criminal proceedings make clear that domestic legal priorities, including consumer protection for unfinished-home buyers, are likely to take precedence over cross-border creditor claims in any remaining asset recovery.
The confiscation of all personal property removes the question of whether Xu retains residual wealth shielded from the corporate collapse. It also narrows the practical avenues for investor recovery. The corporate fines, layered atop existing restructuring proceedings, further diminish the pool of assets available to creditors. What remains unresolved is the fate of the unfinished housing projects themselves, which number in the hundreds and represent a continuing source of social and economic pressure that the criminal sentence alone cannot resolve.
