Finance minister who took part in unauthorized launch of cryptocurrency exchange was replaced in September.

2023.11.29
Apia, Samoa

Samoa wanted Chinese tourists – it got a dreamer and grifters instead — A man sells food to bus passengers waiting to leave Samoa’s capital Apia, Nov. 2, 2023. Colorful public buses are one of the charms of visiting Samoa and are recommended by tourism officials as a good way for visitors to experience the country.

(Stephen Wright/BenarNews)

When the first direct tourist flight from China to Samoa landed in the Pacific island country in late May, it was the culmination of years of effort to tap into the potentially lucrative Chinese market.

Top Samoan officials were at the international airport to welcome the first contingent of Chinese visitors, but the tours quickly ran into strife and the jubilation was short lived.

The flights and related business ventures targeting Samoa have links to several discredited business figures in China, an investigation by affiliated news organizations BenarNews and Radio Free Asia found.

The tourism venture was a stepping stone in plans that called for redeveloping Samoa into a haven for well-heeled immigrants branded as “Eastern International Island” on the website promoting these plans. They also sought to transform the country of 220,000 people into a cryptocurrency and stock trading center.

The ambitions are associated with two senior Samoan government ministers. They also attracted some support from Chinese officials, and were characterized as being part of the Belt and Road Initiative – China’s sprawling plan to dot the globe with ports, railways and other infrastructure.

Although Samoa’s prime minister appears to have sidelined the ventures, the lack of full accountability for government ministers continues to reverberate in the country. The mingling of political office and private business interests, the orbiting cast of grifters and the veneer of Chinese government backing resemble a playbook for how to exploit a developing island state.

A tourist who traveled on the first direct China-Samoa flight is greeted after arriving at Samoa’s Faleolo International Airport, May 28, 2023. (Leota Marc Membrere/Government of Samoa)

Mulipola Anarosa Ale Molioo, who as Samoa’s finance minister took part in the Hong Kong launch of a stock exchange, digital asset exchange and blockchain special economic zone for Samoa, was removed from that role and reassigned in a cabinet reshuffle in September. No reason was given for the specific reassignment.

When the launch took place in April at the luxury St. Regis hotel, Samoa’s coat of arms was projected and plastered throughout the venue. Soon after, Samoa’s Prime Minister Fiame Naomi Mata’afa issued a statement saying the government had not approved the ventures.

Fiame, as part of the reshuffle, took over responsibility for tourism, a key industry for Samoa.

A key local link in the plans is Laauli Leuatea Polataivao Fosi, a cabinet minister and cofounder with Fiame of the new ruling party in Samoa.

The direct flights from China were stopped after criticism of Laauli’s family ties to the Samoan company that with a Hong Kong partner controlled tours in Samoa for the influx of Chinese visitors. Laauli emerged unscathed from the reshuffle.

Some 50,000 acres of land were to be redeveloped in Samoa into 3,000 villas, 54 golf courses, hospitals, rehabilitation centers and other amenities, according to comments attributed to Yao Zhisheng, a member of the Chinese People’s Political Consultative Conference, during a speech he made at the Hong Kong cryptocurrency launch.

Girls look at a mobile phone at a tourist market in Apia, Samoa, Nov. 2, 2023. (Stephen Wright/BenarNews)

The CPPCC has the coordinating role in the Chinese Communist Party’s United Front work that includes foreign-influence campaigns.

Yao’s comments are consistent with plans promoted since 2019 on the website of a Hong Kong-based company, Samoa Trade & Investment Promotion for Hong Kong and Asian countries, which was also the organizer of the cryptocurrency launch. It is connected to discredited businessman Chen Keen and claims to have thousands of acres of land in Samoa.

The trials of Jack Chen

Two of the Hong Kong and China-based figures involved in the plans are relatives of Chen Keen, who is known in Samoa and New Zealand as Jack Chen.

He’s on trial in Hong Kong for money laundering and a U.S. $300 million fraud that took place in the Chinese territory and New Zealand in the late 2000s. It’s his second retrial, according to court documents.

In 2016, he was sentenced in Hong Kong to nearly eight years in prison. The conviction was thrown out in 2019 because of a legal error in the indictment. A retrial in 2021 collapsed when a witness revealed Chen’s previous conviction to the jury. The second retrial began in May this year.

One of the family members is Chen Gen, who is reported in mainland China to be Jack Chen’s brother. Chen Gen is barred for life from holding any position in listed companies or securities businesses in China, according to the country’s stock market regulator. The purported brothers faked the profits of a group of companies in the 2000s, regulatory statements show.

Chen Gen uses another name, Chen Kegen, and according to China’s Enforcement Information Disclosure database, which was established by the country’s Supreme Court, he has 25 instances of defaulting on debts and being subjected to restrictions on his spending since 2013.

A reward was offered this year for information of his whereabouts, shows an online wanted notice about a $700,000 debt that uses Chen Gen’s other name Chen Kegen. Through roles with United Front-affiliated organizations such as overseas Chinese associations, Chen Gen projects another image – that of a do-gooder and patriot.

Laauli Leuatea Polataivao Fosi, Samoa’s agriculture minister and co-founder of Samoa’s ruling FAST party, speaks at an event at party headquarters in Vaitele, Samoa, May 13, 2023. (Joyetter Feagaimaali’i/BenarNews)

The other family member is Luna Chen. BenarNews has identified her as a daughter or other close female relative of Jack Chen, based on common residential addresses in New Zealand and Hong Kong, her age group and other corroborating details.

Luna Chen was the liaison person with Samoa for Travel Focus, a tour business based in Hong Kong that promoted the direct flights from Hainan to Samoa, and is one of the directors of Travel Focus.

She is also a director of the company that both organized the cryptocurrency launch and promoted the land redevelopment plans for Samoa, according to Hong Kong company records.

She is a director of another Hong Kong company, Big Fame, which is in a legal battle in the Chinese territory. A company listed on the Hong Kong Stock Exchange alleged in a filing to the exchange last year that Big Fame had tried to extort money from it by filing a court petition for closure of the company.

Despite a problematic background that included a ban in China on being a company director, Jack Chen cultivated ties to the powerful in New Zealand and Samoa after moving to New Zealand in 2003.

In Samoa, he was bestowed a chief’s title by Laauli’s village, photos of the ceremony show, after reportedly donating money to Samoan rugby. The judge who sentenced Chen in 2016 said Samoa’s prime minister at that time had written to the court vouching for Chen’s good deeds in Samoa.

Luna Chen did not respond to emailed questions and wasn’t in the office when called at a Hong Kong company she is a director of. The law firm representing Jack Chen in his retrial did not respond to two requests to contact him. Via an intermediary, Chen Gen provided a phone number and requested that he be contacted through the WeChat app, but did not answer calls or respond to messages.

Samoa has aspired for some time to have direct flights from China and more Chinese tourists. However, its tourism industry has found that Chinese who can afford to travel to Samoa are mostly not into the resort and beach experiences favored by the Kiwi and Australian visitors around which the tourism industry is built.

“That’s why we allowed the casino,” said Member of Parliament Lealailepule Rimoni Aiafi, referring to two casino licenses issued about a decade ago.

“So we’ve been working on this for a long time,” he said in an interview with BenarNews. “Then this thing came up. And then we look into it. We found out it’s the same name that’s been involved in all this – Jack Chen.”

Lealailepule was part of Samoa’s previous government, led by the Human Rights Protection Party – Samoa’s ruling party for nearly 40 years until its election defeat in 2021. Fiame, the current prime minister, and Laauli are also former members of HRPP governments.

Lealailepule Rimoni Aiafi, a member of Samoa’s parliament, is pictured during an interview at his political party’s headquarters in Apia, Samoa, Oct. 29, 2023. (Stephen Wright/BenarNews)

A third person involved in both the tourism and cryptocurrency and stock exchange ventures, as a director and promoter, is Zhu Hua, who runs a network of purported healthcare businesses in China.

Public records show that courts have ordered high-level consumption restrictions on Zhu on 90 occasions – most recently in April – that bar spending deemed as non-essential such as traveling by plane or high-speed train and staying in hotels above a certain quality. The measures are usually ordered in response to unpaid debts.

Chinese media reports have described Zhu’s health businesses as a multi-level marketing or pyramid scheme.

In 2015, Zhu promoted an at-home test that claimed to detect cancer in five minutes. It aired on CCTV, the main state broadcaster in China.

Videos promoting Zhu’s healthcare businesses feature technology that doesn’t exist or that adds a high-tech twist to traditional Chinese medicine. In one, a woman’s feet are bathed in red light inside an MRI-like machine while medical-textbook type illustrations of a brain appear on displays purportedly connected to the machine.

The pseudo science finds an echo on the website of the Hong Kong-based Samoa Trade & Investment Promotion organization. Alongside its photos of Jack Chen with Samoan officials such as Laauli, the site describes Samoa as a cancer-free country.

Attempts to contact Zhu via two companies he is associated with did not get a response.

Three other individuals that BenarNews identified as connected to the tourism and cryptocurrency ventures also have backgrounds with red flags for regulators. Until earlier this year, one of them headed a company that falsely claimed to be part of one of China’s largest state-owned conglomerates.

Cabinet minister avoids interview

It’s unclear what Mulipola, who became women’s minister after the September cabinet reshuffle, understood about the status of the Hong Kong cryptocurrency event before she attended it. Photos show Mulipola on stage exchanging documents with Zhu and Chen Gen and seated with Chinese officials.

She agreed to an interview with BenarNews but canceled it as reporters waited in a meeting room at her office. An assistant said Mulipola had a sudden doctor’s appointment.

Lauuli, over WhatsApp, said he only wanted to discuss “new issues, new opportunities and new investment for Samoa.” He was overseas when BenarNews carried out reporting in Apia over several days in late October and early November.

The stock and cryptocurrency exchange proposals, if ever realized, could be “very dangerous for a small country like Samoa,” said Lealailepule, the opposition politician.

“We want to develop the country, everybody wants that,” Lealailepule said. “But we also need to make sure that we follow the rules and do what is best for the country, not for yourself or a few individuals.”

Samoans had already been burned in 2018 and 2019 by the One Coin cryptocurrency scam which, the U.S. Department of Justice said, took $4.4 billion from victims worldwide. Shortcomings in financial literacy in Samoa and values that emphasize respect for authority figures and extended family mean that scams can quickly go viral.

In 2018, Samoa’s central bank ordered banks and money-transfer services to block transfers of money out of Samoa related to One Coin. Through two Samoan churches with branches in New Zealand and Australia and the churches’ leaders, the scam continued via Samoans in New Zealand, the central bank has said.

Tapu Tualemafua, a former government official who now runs a small business, said he handed over 1,000 tala ($360) in 2018 to an acquaintance who was collecting money for investment in One Coin.

The get-rich-quick scheme produced no return for Tapu and his 1,000 tala disappeared.

Despite that experience, he said the rapid way cryptocurrency can increase in value makes it appealing. He said he’d consider putting more money into digital currencies if they were under government supervision.

Ceremony in China celebrated first China-Samoa flight

The first of the flights from Haikou in Hainan province was celebrated with a ceremony in China attended by Zhu Hua, Chen Gen, three of Samoa’s cabinet ministers and representatives of United Front and allied organizations, according to photos and a press release from the event published on several Chinese websites.

However, the timing and weekly frequency of the flights appears to have been sprung on Samoa earlier on. It caused concerns and a request for postponement, according to Travel Focus’s own statement in the aftermath–which described Laauli as providing the vision for the venture–and Pativaine Reita Petaia-Tevita, the chief executive of Samoa Tourism Authority.

Before the pandemic, Samoa had almost 180,000 foreign tourists a year. Still recovering from the closure of its borders and with its high-season underway, the country did not have enough suitable accommodation to absorb a weekly flight from China.

“When Travel Focus didn’t take the advice provided, three times, we understood that they had already put in place these flights and it would have cost them and the passengers a lot of money if they were to cancel,” Pativaine told BenarNews.

Travel Focus director Lincoln Linn said it continued to promote tours to Samoa and was “still working closely with Samoa tourism authority and local land operators in Samoa.” Its agency agreement with the Samoa Tourism Authority ended at the end of June and another company was selected as the agent for China.

He didn’t respond to questions about Travel Focus’s connections to Zhu and Jack Chen.

Pativaine Reita Petaia-Tevita, chief executive of the Samoa Tourism Authority, makes a point during an interview at her office in Apia, Samoa, Oct. 31, 2023. (Stephen Wright/BenarNews)

The Samoa Tourism Authority’s offices in the main government building in the capital Apia are barebones but exude friendliness.

A sight-impaired man works on the reception and fa'afafine – transgender women in Samoa – are key members of the organization.

Sitting in front of a large map of Samoa’s two main islands, Pativaine said it’s been her aim to make the authority a positive place to work and a provider of opportunities.

She said she hopes a caring and sustainable approach will also guide how Samoa develops its tourism industry under a policy the authority is developing for cabinet consideration. Work on the tourism policy had been interrupted by the pandemic.

Tourism can benefit Samoa but it also imposes costs, she said, by creating competition for resources, damaging the environment and rubbing up against traditional culture.

“The Samoan people will have to discuss this and decide what type of tourism they would like to have for Samoa,” Pativaine said.

“Once that’s decided then everything else, all the plans will have to follow the policy,” she said.

“And if it means limiting the number of visitors from this market and this market and this market, then so be it.”

BenarNews is an online news outlet affiliated with Radio Free Asia.

MOST READ

RFA

Home

Samoa wanted Chinese tourists – it got a dreamer and grifters instead