Ming Chai has been caught up in an Australian scandal examining organized crime, money laundering, immigration favors and Chinese political influence.
SYDNEY, Australia — When Australian federal agents searched a private jet with high-stakes gamblers at a coastal resort airport in 2016, they were seeking proof of international money laundering.
They didn’t find enough evidence for an arrest, but on board they identified a businessman accused of ties to Chinese crime syndicates — and Ming Chai, an Australian citizen who turned out to be a close relative of China’s powerful top leader, Xi Jinping.
Now Mr. Chai, a cousin of Mr. Xi’s, is part of a broad investigation into organized crime, money laundering and immigration abuse that has raised national security concerns and shaken Australian politics.
It has also crystallized concerns within Australia about a global nexus of crime, ultrawealthy individuals with Chinese Communist Party ties, and the freewheeling, lightly regulated gambling industry of a vital American ally.
Many lawmakers now say the case demands a thoughtful reckoning for Australia — and other countries — that have welcomed Chinese wealth but often closed their eyes to its source, and to whether its riches are being used to promote the interests of the Communist Party.
At the center of the inquiry, Australian officials say, is Crown Resorts, the casino giant formerly controlled by one of Australia’s richest men, James Packer. The company has been accused of helping its most lucrative clients launder money and circumvent Australia’s strict immigration laws.
Mr. Chai is not the main target of the investigation, officials say. But among other things, investigators are exploring his ties to Tom Zhou, the businessman who was on the plane with him and who himself has ties to Crown.
Investigators are also looking into the source of Mr. Chai’s money — including millions of dollars gambled at Crown casinos — and whether it was used in Australia to support the interests of the Chinese Communist Party.
There is no evidence or suggestion that Mr. Xi had any knowledge of or involvement with any of Mr. Chai’s activities. In a statement, Crown said it “absolutely rejects allegations of illegality,” describing them as “an attempt to smear the company.” Mr. Packer, through his lawyer, said he has not held an executive position at the company since 2012 and had a passive role in Crown’s affairs.
The inquiry into Mr. Chai’s activities was first reported by Australian news outlets The Age, The Sydney Morning Herald and Nine, a television network. The Australian police declined to comment. On Tuesday, China’s Foreign Ministry dismissed the news reports as “gossip.”
“They tried to smear China with groundless accusations based on some rumors,” said Hua Chunying, a ministry spokeswoman, at a regular news briefing.
The initial focus of the investigation was Mr. Zhou, whose company, known simply as Chinatown, organized gambling tours for clients betting tens of millions of dollars.
He worked closely with sales managers for Crown’s so-called V.I.P. program, acting as a business partner who delivered wealthy gamblers and vouched for their legitimacy, earning hefty commissions in the process, according to company emails from 2013 to 2015 that The New York Times reviewed.
These emails and other internal records reviewed by The Timesreferred repeatedly to Mr. Zhou and his company along with several other intermediaries known as junket operators, who often move large sums of money for their clients, with little transparency.
The amounts flowing out of China were multiples more than the official limit placed on ordinary Chinese citizens by the Chinese government, raising questions about fraud and money laundering, according to the documents and interviews with business associates of Mr. Chai and Mr. Zhou in Hong Kong and China.
Efforts to reach Mr. Chai and Mr. Zhou through their companies and business associates in China were unsuccessful. Several Chinese-Australian social and business groups to which Mr. Zhou has been publicly linked also did not respond to requests for comment. One group, Huaxing Arts Group Australia, said “we don’t have any person by this name in our Association.”
At the large home in Melbourne that Mr. Chai’s wife purchased in 2011 for 3.85 million Australian dollars ($2.6 million), according to property records, a woman speaking on a cellphone in the front yard declined to answer questions.
The documents from Crown suggest there was little if any scrutiny of where money from Mr. Chai or other high-rollers came from, despite laws requiring that casinos “know your customer.” (Crown has said it has a comprehensive anti-money laundering and counter-terrorism financing program.)
The Crown documents also show that the biggest spenders were lured with flights, cash advances and other perks.
Tickets to events, including a Mariah Carey concert, and seats on private jets were only part of the packages. Emails from 2015 also show that Crown officials worked closely with Australian Consulate officers to fast-track visa approvals for Chinese clients through a special “hotline.”
It was used often enough for one Crown executive to warn that “the purpose of the special line is not for last minute girlfriend additions.”
Rather, the executive wrote, it should be reserved for “critical cases (ie big customers).”
“In those situations,” he wrote, “the consulate is very understanding and will do everything they can to help us.”
In a statement on Tuesday, the Department of Home Affairs confirmed it has “stakeholder arrangements” with several large international organizations for speedy processing of short stay visas, but insisted there was no special treatment given to applicants.
The department said the arrangement with Crown ended in 2016.
In 2017, a court in Shanghai sentenced three Australian employees of Crown to prison for illegally promoting gambling in China.
Separately, court transcripts in China show Mr. Zhou, who is also known as Zhou Jiuming, has been named in several civil and criminal cases including one that accuses him of misappropriating “a huge amount” of funds. That same case references separate criminal charges against him and cites investigations by the police for economic crimes in Wuhan, China. Details of Mr. Zhou’s criminal charges are not publicly available.
Mr. Zhou and Mr. Chai were business partners through companies registered in Hong Kong and Australia that are suspected of being set up simply to move large sums of money out of China to Australia, according to a person familiar with the companies, and the Australian authorities.
Mr. Chai is listed in several internal Crown documents as one of the company’s V.V.I.P.s, or Very Very Important Persons. One internal record shows he had spent $28 million (41 million Australian dollars) over 18 months starting in June of 2012, and in the following year he was listed as one of Crown’s top 50 customers based on gambling turnover.
It is not clear when he became an Australian citizen, but corporate registrations with his Australian passport go as far back as 2005.
Among the questions being asked now, Australian officials said, is whether Mr. Chai is simply a partner of Mr. Zhou, or has played a broader role with other Communist Party officials who the authorities believe might have been trying to launder money through Australian casinos, or move money to finance foreign interference or espionage in Australia.
Several of the Chinese-Australian groups Mr. Zhou has been involved with in Australia, including the Hubei Association of Australia and Huaxing Arts Group of Melbourne have been described by analysts as closely aligned with the United Front Work Department, a muscular agency that presses for support of the Communist Party agenda abroad. United Front associates have been linked with campaign contributions and other efforts to influence Australian politics.
On the plane that was searched in 2016, according to information shared among law enforcement agencies involved in the investigation, Mr. Chai and another passenger referred to Mr. Zhou as the boss when confronted by the Australian authorities.
Mr. Chai, however, enjoys an elevated status in China’s business and political worlds because of his family connections within the Communist Party. At one point, he was described as leading a research institute at the Central Party School, the party’s main academy for training officials.
His father, Qi Ruixin, was a vice party secretary of the China National Gold Group and a top official at China’s so-called Gold Force, the gold and mineral exploration arm of the People’s Armed Police. Mr. Qi was described in his official biography as being close to Mr. Xi.
In business, Mr. Chai’s dealings were varied and seemed to draw on his father’s contacts.
A half-dozen companies in Hong Kong are registered under Mr. Chai’s name. One, Cathay Bullion Marketing Services, appears to have a connection to silver and gold.
More recently, he held a senior position at a company owned by ZTE, a telecommunications company, and appeared at events for ZTE like Boao, an annual economic forum for the global elite. ZTE did not respond to a request for comment about Mr. Chai.
He also worked as the chief executive of a robotics and telecoms company, Ningbo GQY.
One of Mr. Chai’s businesses, HK Success Ocean Investment, is registered to a red brick house in a neighborhood on the southeast fringe of Melbourne.
Neighbors said they were not sure who lived there. Some said they believed that the home had been rented, with new residents only recently moving in.
Australian officials who were briefed on the investigation into Crown and Mr. Zhou said several agencies had been looking into elements of the case for years, but that in recent months, they came to believe they were scrutinizing limbs of the same giant beast.
The expanding scandal has fueled concerns about Australia’s permissiveness both with its own gambling industry, and China’s powerful elites.
Several new inquiries have been ordered, in the state of Victoria and by Australia’s attorney general, Christian Porter.
Lawmakers have only just begun to consider the broader implications of the case and how the country’s response will be viewed by China, and the world’s democracies.
“The time has come when you have to stand up for those values and not be clouded by financial interests,” said Senator Concetta Fierravanti-Wells from New South Wales, in an interview between votes in the Senate. “If we profess to support an international rules-based order then we have to continue to support that rules-based order.”