Chinese couple arrested for trying to establish Hong Kong-style region in US-defended Marshall Islands

US prosecutors said Cary Yan and Gina Zhou offered bribes to Marshall Islands officials in an attempt to set up their own semi-autonomous region

The Pacific islands are pro-Taiwan and a former territory of the US, with Washington saying it maintains ‘full authority and responsibility’ for their defence

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Majuro, capital city of the Marshall Islands. Photo: Shutterstock

Published: 9:39am, 7 Sep 2022Updated: 7:30pm, 7 Sep 2022

A Chinese couple has been arrested and indicted for what the US Department of Justice described as a “multi-year scheme” to try to, among other things, establish an autonomous mini-state in the Marshall Islands, a former US territory.

According to a DOJ press release on Friday, Cary Yan, 50, and Gina Zhou, 34, are accused of money laundering and violating the Foreign Corrupt Practices Act.

The indictment of Yan and Zhou outlines allegations from prosecutors of how the pair had posed as officers linked to a non-governmental organisation in New York City and tried to bribe Marshall Islands officials while in US territory. According to the filing, the NGO also held a “special consultative status” with the UN Department of Economic and Social Affairs from around 2016 to 2018.

The Marshall Islands are a former US territory that gained independence in 1986 and is known for the Bikini Atoll, a coral reef where the US tested nuclear weapons following World War II. The US still maintains “full authority and responsibility” for the Marshall Islands’ defence, according to the State Department.

According to the couple’s indictment, they had taken meetings in New York in an attempt to carve out a semi-autonomous region, akin to Hong Kong, in an area called the Rongelap Atoll. This autonomous region would have allowed Yan, Zhou, and their organisation to bring in investors to work on economic and social projects, which they said would take place in the region.

Prosecutors said Yan and Zhou floated this idea of the “Rongelap Special Economic Zone”, while offering cash bribes to try to influence Marshall Islands legislators to create the zone.

The Marshall Islands is, coincidentally, known to be pro-Taiwan. It is one of only 14 countries that have formal diplomatic ties with Taipei instead of Beijing, which views self-ruled Taiwan as a breakaway province.