How a renegade Chinese billionaire became a center of D.C. intrigue
Category: News & PoliticsVia: ender • last year • 3 comments
A billionaire at the center of U.S.-China tensions is waging a mysterious legal battle against two D.C. conservatives over a private espionage deal gone bad. The fight touches on a pair of think tanks, a senator’s widow and the capital’s tight-knit group of China hardliners, adding a new chapter to an international saga that has divided the Trump administration and the president’s external allies.
It began when a firm tied to the billionaire, real estate magnate Guo Wengui, allegedly hired a private intelligence firm to dig up dirt on Chinese nationals — including their bank records, porn habits and any illegitimate children — then sued, saying the firm failed to deliver. In turn, the intelligence firm has claimed Guo’s side gave it a thumb drive loaded with sophisticated malware and that he sought information on people whose records were deemed sensitive by the U.S. government.
The ongoing suit, the details of which are reported here for the first time, deepens the already considerable mystique surrounding the billionaire businessman. An ally of Steve Bannon’s and a fugitive from Chinese authorities, Guo now lives in New York. His presence in the U.S. has exacerbated tensions between China’s ruling Communist Party and the administration of President Donald Trump.
The case also offers a rare behind-the-curtain glimpse at the tactics of 21st century geopolitical intrigue, where it is increasingly common for deep-pocketed clients with political agendas to pay firms with government contacts and cyber know-how to obtain people’s sensitive private information — and then use it to destroy them.
The details of the suit, which is being waged in federal court in the Southern District of New York, read more like a spy novel than a dry legal document.
Guo, who goes by Miles Kwok in the U.S., built a sizable fortune in real estate in China before apparently running afoul of the country’s government and fleeing in 2014. A year later, he came to the U.S., where he is seeking asylum while he lives in an opulent Manhattan apartment and publicizes claims of corruption against Chinese government officials. Since Guo fled to the U.S., the Chinese government has accused him of a raft of crimes, and a former assistant has accused him of rape . Guo has denied the allegations against him, calling them politically motivated.
In early 2018, the Guo-linked firm hired Strategic Vision, an obscure company led by Washington-area executive French Wallop, to dig up information on several targets, whom the suit does not name.
According to a court filing by Wallop’s firm, Guo enlisted it, "To perform research and analytics on numerous Chinese Nationals whom Mr. Guo and his undisclosed Chinese associates suspected to be engaged in activities in the United States and elsewhere that are inconsistent with their standing in the Chinese Communist Party and/or the laws of the United States."
Wallop was the third wife of Malcolm Wallop, the late Republican senator from Wyoming. In recent years, she has maintained a low profile in Washington, though in the midst of her divorce from the senator in 2000, the Washington Post’s gossip columnist obtained a sharply worded change-of-address note she sent around to friends stating, “French Wallop regrets to inform you that due to a significant indiscretion on the part of her husband of 16 years, he may now be reached at the following address.” On her LinkedIn profile , Wallop refers to Strategic Vision as a “strategic consulting firm.”
In addition to Wallop, J. Michael Waller acted as a representative of Strategic Vision, according to a letter the firm submitted to the court. Waller is a vice president at the far-right Center for Security Policy, a think tank founded by Frank Gaffney, a national security activist known for his conspiratorial hostility to Islam. Waller also served as the ghostwriter for the memoirs of Blackwater founder Erik Prince, according to his website .
By late 2017, when Guo was allegedly arranging for the contract, he also became something of a political football as Beijing sought his return to China. Earlier that year, China issued an Interpol red notice for his arrest. Then Chinese officials traveling to the U.S. on transit visas, which did not permit them to conduct government business, visited Guo at his apartment. This prompted a standoff, first reported by the Wall Street Journal, between the Justice Department, which wanted to arrest the Chinese officials, and the State Department, which successfully held the DOJ at bay.
Casino magnate Steve Wynn, a longtime Trump confidant with business interests in China, reportedly hand-delivered the president a letter from the Chinese government requesting Guo’s handover, though Wynn’s firm has denied it. Guo’s fate became a subject of heated internal debate within the administration, and former Attorney General Jeff Sessions reportedly threatened to resign if the renegade mogul was turned over to China.
According to one person who knows the people involved, it was in the context of this battle over his fate that Guo sought dirt on Chinese nationals: He wanted, this person said, to ingratiate himself with U.S. authorities by offering them intelligence, financed from his own fortune, in a bid to show he could be useful.
In January 2018, a Hong Kong firm tied to Guo, Eastern Profit, inked a contract with Strategic Vision US. It is rare for the details of private espionage agreements to see the light of day, but Strategic Vision attached its five-page agreement as an exhibit to a counterclaim it lodged in response to the suit. The contract promises $9 million in exchange for a year’s worth of snooping on 10 unnamed individuals — referred to in the document as “fish” — calling for details on everything from their movements to financial records to sensitive personal information. That includes details on a “subject's family, extramarital affairs, children born out of wedlock” as well as their “pornography” and their use of “‘dating’ or sexual services apps.”
According to the Guo-linked firm’s complaint, Strategic Vision said it had a former NSA agent on staff and said it had worked “for Republican politicians, a Middle Eastern prince and a politician belonging to the opposition party in Russia.” Guo’s side also alleged that Strategic Vision provided a “sample report, which appeared to show that Strategic Vision could enter into banking systems and find evidence of money laundering.” But, the complaint alleges, after Guo advanced Strategic Vision an initial $1 million payment, it discovered the firm did not have the capabilities it claimed.
Not long after, Eastern Profit sued Strategic Vision. The case remained under seal for several months, keeping it from public view. Though much of the court record has now been unsealed, parts of the case remain under a protective order that prevents sensitive details from being revealed.
In a countersuit, Strategic Vision accused Guo and his representatives of a variety of troubling actions. The firm, which denied most of Eastern Profit’s allegations, claimed that when a representative of Guo’s provided a thumb drive with information on his chosen surveillance targets — Chinese officials whom Guo allegedly suspected of wrongdoing — the thumb drive turned out to be loaded with sophisticated malware. After the firm complained, it says it received three new thumb drives from Guo’s side, one of which also contained malware.
According to the counter-claim, which has been dismissed without prejudice, Guo was introduced to Strategic Vision by Lianchao Han, a dissident activist and visiting fellow at the conservative Hudson Institute. But, it alleges, Guo later told the firm that Han could not be trusted. Instead, Guo allegedly told the firm to communicate with his assistant, whom Guo “oddly advised was a member of the Chinese Communist Party who also could not be trusted.” Han did not respond to requests for comment.
The firm also alleged that, when it began researching its targets, it discovered they “had been designated by the U.S. Department of State under the Obama administration as ‘Records Protected’ persons, meaning that information concerning their status and activities was not subject to disclosure under any circumstances. Strategic Vision learned that attempting to research subjects known to be 'Records Protected' could be a criminal activity."
It is not clear to what exactly the “Records Protected” designation refers. The State Department did not respond to questions about the term, and several former top legal advisers at State said they were not familiar with it.
“I have never heard of a State Department ‘records protected’ designation per se,” wrote Brian Egan, a partner at the law firm Steptoe who served as the department’s top legal adviser at the end of Barack Obama’s administration. “I am also having a hard time imagining a circumstance in which a private person or company could be prosecuted for merely attempting to research information about a particular individual.”
A lawyer for Eastern Profit, Zachary Grendi, forwarded a request for comment to Daniel Podhaskie, a lawyer for Guo’s family office, who declined to comment. A lawyer for Strategic Vision, Mark Berube, did not respond to requests for comment. Waller declined to comment on the record.
The circumstances of the lawsuit are just one of the many mysteries swirling around Guo. Many basic details of his biography, including his exact age, remain hazy.
He was born roughly 50 years ago, reportedly in the coastal Shandong Province in Eastern China — or, he has claimed, in Jilin Province in the country’s north — and made a fortune in real estate, benefiting from the construction boom around the 2008 Olympics in Beijing. There, he developed a reputation for playing hardball. After clashing with a deputy mayor of Beijing, Guo gave the police a video of the official having sex with his mistress, prompting the man’s arrest and political downfall .
Guo appears to owe his rise in part to his relationship with a top official at China’s Ministry of State Security. The official, former vice minister Ma Jian, fell out of favor and was arrested in early 2015 on corruption charges. Two months later, the Chinese outlet Caixin published an expose of Guo, highlighting his ties to the toppled intelligence official.
By that point, Guo had already fled China.
Since arriving in the U.S., Guo has constantly irritated the ruling party, spouting a steady stream of salacious allegations about corruption and other official wrongdoing.
Ensconced in New York, the renegade businessman set up Guo Media to amplify his campaign against the Communist Party and often dispenses his accusations via video livestream while going about his billionaire lifestyle — including from the deck of his $20 million yacht.
Guo accused China’s top anti-corruption official, Wang Qishan, of corruption and of having an affair with a famous actress, Fan Bingbing, whose temporary disappearance became an international mystery of its own last year. He also offered his own theory on the 2014 disappearance of Malaysia Airlines Flight 370, claiming the CCP brought down the Beijing-bound plane to get rid of people who could have blown the whistle on an organ-harvesting scheme in Nanjing.
Guo’s bombastic style and real estate background have prompted comparisons to Trump.
He is even a member of Mar-a-Lago, prompting concerns that he might attempt to show up at the club during Xi’s first summit with Trump in the spring of 2017 and cause some sort of international incident.
“I like because Donald Trump the president talks [about] fake news. This idea is really good,” Guo, whose English is rudimentary, told Vice News. “Everything [said] about me is fake.”
One thing about Guo is clear: Since arriving in the U.S., he has embraced the country’s litigious culture. In addition to the private spying case, he is embroiled in several ongoing legal fights, including a dispute with his former attorneys at Boies Schiller Flexner, the firm founded by politically connected super lawyer David Boies. Guo also sued Republican dirty trickster Roger Stone, Trump’s longtime political adviser, last year for $100 million after Stone claimed the billionaire had illegally donated to Hillary Clinton and was funding a presidential run by Bannon. In December, Stone retracted his statements and apologized .
Guo’s lawsuit against Strategic Vision could prove awkward for Washington’s small community of China hardliners.
In March, several prominent China hawks launched Committee on the Present Danger, a new conservative advocacy group aimed at encouraging U.S. confrontation with China. The group, which includes former CIA director Jim Woolsey, has held events in New York and Washington, including an April roundtable on Capitol Hill that featured Republican Sen. Ted Cruz of Texas.
While members of the committee are united on China, they are divided on Guo.
Both Waller, who is fighting Guo, and Bannon, the billionaire’s closest ally in the U.S., are members of the committee. The group also includes Gaffney, whose think tank employs Waller, and Han, who introduced Guo to Strategic Vision, only to have Guo allegedly turn around and badmouth Han as untrustworthy.
But as the dispute winds its way through court, the committee is presenting a united front. Gaffney said he was not aware of any internal strife the suit had caused within the group.
Bannon declined to comment on the record. He maintains warm relations with Guo, whom he calls “Miles” and has met with dozens of times. The lawsuit has done nothing to slow the pair’s crusade against Beijing.
In recent days, what appears to be the Twitter account for Guo Media has repeatedly posted a photo of Bannon and Guo hugging each other as well as a photo of Bannon photoshopped to show him aiming a double-barreled pistol with flames behind him in the background.
On Sunday, Guo Media’s YouTube page posted a video of a three-hour political discussion between Bannon and Guo, who sat together at a desk in front of a Chinese landscape painting.
"The Chinese people are being suppressed and enslaved,” Bannon, dressed all in black, declared.
Guo, in a tailored blue suit, smiled and gestured expressively. On an iPad, Guo showed Bannon messages he said came from Chinese citizens.
"All of these messages are to express love to Mr. Bannon,” Guo said. “They all tell you that they love you, Mr. Bannon.”
Despite his aggressive campaign against Beijing, Guo remains a puzzle to China-watchers, with some supporting his asylum hopes and others remaining suspicious of his motives.
A Times Magazine profile of Guo last year reported that some Chinese dissidents in New York suspect him of actually being a spy for Beijing.
Others say he has already proven useful to the U.S. “I’ve interviewed him, and he has sensitive knowledge of high-level Chinese Communist politics,” said Michael Pillsbury, a fluent Mandarin speaker who spent decades as a China analyst in the federal government and now serves as a top outside adviser to Trump on the country. “I also don’t think he should be returned to China.”
As Trump and Xi head into an expected meeting later this month at the G-20 summit in Japan to hash out differences over trade policy, Guo remains in the background as a lingering wrinkle in U.S.-China relations — and a lingering mystery.
06/07/2019 05:06 AM EDT
Photo: The details of a suit tied to Guo Wengui, which is being waged in federal court in the Southern District of New York, read more like a spy novel than a dry legal document. | Drew Angerer/Getty Images