A Chinese student has been ordered by the Supreme Court of Victoria to repay nearly $5 million and transfer two properties back to his mother after he admitted to squandering funds she entrusted to him for real estate investment. The court rejected his claim that the substantial sums were a gift, citing his own remorseful admissions made in messages to his mother.
Student’s Lavish Spending Undermines Investment Claims
Allen Xu, 29, received approximately $18 million from his mother, Jiyun Ma, over a six-year period, with the initial intention of investing in Sydney’s property market. However, instead of adhering to his mother’s instructions, Xu allegedly used a significant portion of the money for personal luxuries, including cosmetic surgery, high-end jewelry, a car, and a lavish apartment. His claim that the money was a gift was ultimately dismissed by the Supreme Court and subsequently by a Court of Appeal.
The pivotal evidence against Mr. Xu came in the form of WeChat messages he sent to his mother. In these communications, he expressed deep remorse, describing himself as “greedy, dishonest, immoral, and a very bad person” who “couldn’t control the devil living in my heart.” These admissions were instrumental in the court’s decision, as they contradicted his later legal arguments.
Timeline of Fund Transfers and Misappropriation
The financial arrangement began around 2020 when Ms. Ma transferred $5 million to her son. This initial sum was intended to help him qualify for a business innovation and investment visa, a pathway facilitated by his Master of Economics studies at the University of Sydney, which his mother also financed. Ms. Ma, who has never visited Australia, continued to support her son financially.
In April 2021, Ms. Ma sent nearly $2 million for the purchase of a $1.8 million property in Haymarket, Sydney, which was registered in Allen Xu’s name. Between July 2021 and May 2022, a further $11,133,322 was transferred to Mr. Xu from banks in China and Canada, with the explicit instruction that these funds were to be invested in property on his mother’s behalf.
Instead of fulfilling his mother’s investment directives, Mr. Xu allegedly diverted these substantial funds. Court documents indicate he spent a portion on cosmetic eyelid surgery and acquired an apartment in Wentworth Point. The remaining money was reportedly placed into a bank account solely under his name.
Apology Drafts Reveal Extent of Misconduct
By June 2022, Ms. Ma became aware of the situation and demanded the return of her money. Mr. Xu sought assistance from his uncle, referred to as Mr. Peng in court documents, to draft an apology to his mother. Early drafts of these messages, shown to the court, detailed Mr. Xu’s realization of his actions. He acknowledged becoming arrogant upon receiving his mother’s hard-earned wealth and admitted to satisfying his own desires and expanding his horizons with her money, confessing, “I’m just vain.”
Mr. Peng advised his nephew that a simple apology was insufficient and that he needed to explain his deception. Mr. Xu had misled his mother about opening a bank account in his father’s name for the remaining funds, when in reality, he opened it in his own name. He also provided an unrealistic explanation for spending approximately $250,000 on “living necessities.” Further discrepancies arose concerning the conversion of his mother’s money from USD to AUD without her knowledge and an unaccounted-for sum of $350,000.
In a subsequent draft, Mr. Xu explained his decision to open the bank account in his own name by stating he feared his mother would “blame me for my incompetence.” He reiterated his self-condemnation, stating, “Yes, I am a greedy person, a dishonest person, an immoral person, and a very bad person. The bottom line is that I used your money.” He further expressed extreme regret, acknowledging he was an “embezzler” and that he lacked the ability to earn such wealth himself, admitting he “really couldn’t control the devil living in my heart.”
Court Rejects Appeal and Upholds Original Judgment
During the court proceedings, Mr. Xu attempted to distance himself from the second draft apology. However, the court found this implausible, as the message contained specific details about his eyelid surgery, the Wentworth Point property, and luxury purchases, which were corroborated by property deeds, bank records, and transaction histories. These granular details, the court concluded, could not have been fabricated by his uncle.
The final version of the apology was sent to Ms. Ma in late June. Following this, she requested power of attorney over his bank and investment accounts, which he granted. She subsequently evicted him from the Haymarket unit. Mr. Xu sent further messages acknowledging the Haymarket and Wentworth Point units as his mother’s property and promising not to upset her again.
In his appeal, Mr. Xu argued that he only granted power of attorney under intense emotional duress and that his eyelid surgery had impaired his vision, making it impossible for him to have written the second draft apology. He presented photos of his swollen eyes as evidence. The court, however, noted that the surgery occurred three weeks prior to the letter’s writing and deemed it “implausible” that he could not read the draft, especially given he had written a handwritten letter previously.
The court also referenced messages where Mr. Xu referred to the Haymarket unit as his mother’s property and requested more time to vacate, reinforcing the finding that signing the power of attorney was consistent with his acknowledgment that the unit was not his.
Financial Judgment and Property Transfer
Ms. Ma initiated civil proceedings in November 2022, seeking the return of the $11.1 million transferred between 2021 and 2022. Although she had access to approximately $7 million from his bank accounts and both properties, she was still financially short. The initial $5 million for the visa and the $2 million for the Haymarket property were not included in this claim.
In June 2025, Justice David Croft delivered the primary judgment in favor of Ms. Ma. He ordered Mr. Xu to repay $3,120,445.72, along with $989,063.04 in interest. Furthermore, Justice Croft declared that Mr. Xu held the Haymarket and Wentworth Point properties in trust for Ms. Ma and mandated that he take all necessary steps to transfer ownership to her.
Mr. Xu’s appeal contested the findings, denying he admitted the properties were not his and asserting his belief that the money was an outright gift. He also pointed to a 2016 conversation where his mother expressed a desire to compensate him for lost time during his childhood, suggesting this implied the funds were a gift. However, Ms. Ma’s legal team successfully argued that this statement was conditional on her passing away, which did not occur. The Court of Appeal ultimately upheld the initial judgment, dismissing Mr. Xu’s appeal.
