Page 21 - Islands Business October 2023 edition

Special Report

CHINESE GRIFTERS TIE UP UN,

MARSHALLS IN SCAM

By Aubrey Belford, Kevin G. Hall, and Martin Young/OCCRP

The stakes could scarcely have been higher for Hilda Heine,
the former President of the Marshall Islands.
For years, her remote archipelago nation of just 40,000
people was best known to the world—if known at all—for Cold
War nuclear testing that left scores of its islands poisoned.
Sitting in the center of the Pacific Ocean, the country was a
strategic but forgotten U.S. ally.
But the arrival of a couple of mysterious strangers
threatened to change all that. With buckets of cash at their
disposal, the Chinese pair, Cary Yan and Gina Zhou, had
grand plans that could have thrust the Marshall Islands into
the growing rivalry between China and the West and perhaps
fracture the country itself. Yan smiles while former UN Secretary-General Ban Ki-moon (center) holds a box of
First proposed in 2017, while Heine was still President, Yan his miracle water as former General Assembly President Sam Kutesa (right) looks on.
(Credit: Emails obtained by reporters)
and Zhou’s idea raised public controversy. With backing from
foreign investors, the couple planned to rehabilitate one
irradiated atoll, Rongelap, and turn it into a futuristic “digital
special administrative region.” The new city of artificial The plan came to an abrupt end in November 2020, when
islands would include an aviation logistics center, wellness Yan and Zhou were arrested in Thailand on a U.S. warrant.
resorts, a gaming and entertainment zone, and foreign After being extradited to face trial in New York, they pleaded
embassies. guilty to a single count of conspiracy to bribe Marshallese
Thanks in part to the liberal payment of bribes, Yan officials.
and Zhou had managed to gain the support of some of the Both were sentenced earlier this year. Zhou was deported
Marshall Islands’ most powerful politicians. They then lobbied to the Marshall Islands shortly after her sentencing, while Yan
for a draft bill that would have given the proposed zone, is due for release this November.
known as the Rongelap Atoll Special Administrative Region But although the federal case led to a brief burst of media
(RASAR), its own separate courts and immigration laws. attention, it left key questions unanswered.
Heine was opposed. The whole thing reeked of a Chinese Who really were Yan and Zhou? Who helped them in
effort to gain influence over the strategically located Marshall their audacious scheme? Were they simply crooks? Or were
Islands, she told OCCRP. they also working to advance the interests of the Chinese
The plan was unconstitutional and would have created a government?
virtually “independent country” within the Marshall Islands’ OCCRP spent nearly a year trying to find answers,
borders, she said. The new Chinese investor-backed zone conducting interviews around the world and poring through
would also have occupied a geographically sensitive spot just thousands of pages of documents. What reporters uncovered
200 kilometers of open water away from Kwajalein Atoll, was a story more bizarre—and with far broader implications—
where the U.S. Army runs facilities that test intercontinental than first expected.
ballistic missiles and track foreign rocket launches. As it turns out, Yan and Zhou were able to carry out their
But when President Heine argued against the draft law, plans thanks to an earlier, successful ploy to buy high-level
she became a target herself. In November 2018, pro-RASAR influence at the United Nations in New York.
politicians backed by Yan and Zhou pushed a no-confidence In just a couple of years, the pair went from hawking scam
motion to remove her from power. She survived by one vote. miracle water to rubbing shoulders with world leaders and
Even then, the President said she had no idea who this diplomatic grandees in Manhattan.
influential duo really were. Although they seemed to be They gained access to the U.N. after paying over a
Chinese, they carried Marshall Islands passports, which gave million dollars to diplomats and fixers. Among those who
them visa free access to the United States. Nobody seemed to helped them were staff of the former President of the U.N.
know how they had obtained them. General Assembly, an alleged Chinese agent, and a disgraced
“We looked and looked and we couldn’t find when and how ambassador then already under investigation by the FBI in a
they got [the passports],” Heine said. “We didn’t know what separate case.
their connections were or if they had any connections with The couple also hijacked a charity affiliated with the United
the Chinese government. But of course we were suspicious.” Nations and turned it into a base for Chinese businesspeople

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