China’s “Copper King” sentenced to life imprisonment: the fall of the massive Maike empire

The founder and head of China's major trading giant Maike Metals International, 61-year-old entrepreneur He Jinbi, once described as the country's "Copper King," has been sentenced to life in prison for contract fraud and bribery. This was reported by Bloomberg, citing its own sources.

According to a closed-door ruling by a Xi'an court, the company leadership's fraudulent and illegal financial activities posed a risk of direct losses exceeding $1 billion to several major Chinese banks. The billionaire entrepreneur himself has filed an appeal against the court's verdict.

An empire that started with $8,700: 25% of China's copper market

He Jinbi's business path was one of the most remarkable rises in modern Chinese trade and industrial history:

• First steps: In 1993, he founded the Maike trading house in Xi'an with friends using a loan of just 50,000 yuan (approximately $8,700 at the exchange rate at the time);

• Becoming a copper giant: Starting with the sale of electrical and mechanical products, the business soon specialized in scrap metal, copper wire, and refined copper trading;

• Monopoly position in the market: At the peak of its development, Maike Metals alone supplied a quarter (25%) of all copper raw materials imported by China.

Chain of crisis: Pandemic, real estate collapse, and metal collateral

Risky financial schemes in the company's operations began to falter during the pandemic:

• Dangerous lending scheme: Maike attracted billions of yuan in loans by pledging massive copper reserves stored in its warehouses and in transit to banks;

• Real estate crisis: Beyond trading, the tycoon had invested heavily in the construction of hotels and business centers. However, the crisis in China's real estate market "froze" these funds;

• Pandemic and price drops: Strict COVID restrictions in 2022 disrupted logistics, while a sharp decline in copper prices on the global market led to cash flow issues and an inability to repay debts.

Arrest, bankruptcy, and the defense's position

The final collapse of the empire and the legal proceedings unfolded as follows:

• Sensational disappearance: In October 2023, company employees lost all contact with the leader, and shortly thereafter, it was revealed that he had been arrested by the police. The following month, Maike officially declared bankruptcy;

• Arguments of the lawyers: In court, the defense insisted that the entrepreneur had no intent to commit fraud and that the company had consistently met its obligations to banks for over a decade;

• Banks' error: According to the defense, one of the main reasons for the massive bank losses was the weak risk-management systems of the creditors themselves.

Key indicators of the Maike Metals and He Jinbi case

He Jinbi's case remains in the history of global commodity markets as one of the largest financial crimes in China resulting from the pandemic and the real estate market collapse.