Why you shouldn’t give your son a Ferrari

A spate of high-profile accidents during the past few months involving fast cars and rich heirs is trying the patience of leadership — and the common man — across Asia.

Finance Asia

Lara Wozniak

A Ferrari has long been a red flag for cops, who may reasonably assume that the driver is inclined to speed.

But in Asia, it has also become a red flag for wealth advisers, who may fear the threat that it represents to a family’s reputation or its political standing. Even so, such decisions are clearly not within their remit. If a senior party cadre cannot control his unruly offspring, it is unlikely that a financial adviser will have any more luck.

As one private banker said: “Look, they get the car, and then I see it and shake my head; it’s not something they ask me about for advice. They talk to me about how to make their money make them more money.”

But given the recent spate of scandals, perhaps high-net-worth individuals, particularly those with political ambitions in China, should seek advice from their wealth advisers about how they spend their money.

“From a political risk point of view, if I was a Chinese party leader in this political climate I would be garaging my sons’ and daughters’ Ferraris and any other flash cars, ensuring that they kept a very low profile and avoiding any activity likely to cause a stir,” said Steve Vickers, chief executive officer of Steve Vickers & Associates, a specialist risk mitigation, corporate intelligence, security and consulting company.

“The corruption button has never been hotter or of more concern to the leadership,” he added.

The tale of a black Ferrari 458 Spider that crashed on Beijing’s Fourth Ring Road in March probably would have gotten more air-time, despite China’s efforts to squelch the story, if other political intrigue wasn’t unfolding at the same time. On March 18, a half-undressed, unnamed young man died behind the wheel of his Ferrari while two women, one of whom was allegedly naked, sustained injuries. That’s definitely the stuff of gossip, even if censors go into overdrive to suppress it.

But only three days earlier China had announced that Bo Xilai had been removed from his post as party chief in Chongqing after his head of police fled to the US consulate in Chengdu amid the mysterious death of British businessman Neil Heywood. That story, and its numerous offshoots, dominated China news until late August, when Bo’s wife was found guilty of Heywood’s murder. In the meantime, the story of a crashed Ferrari faded to the background.

That is, until this past weekend, when officials leaked that the driver was 23-year-old Ling Gu, the son of Ling Jihua, who is a close ally of the departing president, Hu Jintao. That news was finally released when officials also announced that Ling was being demoted from his role as head of the General Office of the party’s Central Committee — essentially Hu’s right-hand man. In short, Ling lost his son and his power as he was demoted ahead of the coming leadership change.

After all, how can a Communist party official’s son afford a $700,000 car? Clearly the old, conservative officials that built the past 30 years of success in China are displeased with the some of the shenanigans of the younger generation.

But it’s not just in China. Earlier this week news trickled out about another scion of a powerful family — this time the grandson of the creator of Red Bull, an energy drink. Vorayuth Yoovidhya, 27, was driving his Ferrari when he allegedly ran over a Thai police officer, killing him, and then fled the scene.

While no one questions how Vorayuth could afford a Ferrari, Thais are up in arms about how the case nearly got dismissed. Bangkok’s top police official, Comronwit Toopgrajank, said he took charge of the investigation after a lower-ranking policeman initially tried to arrest someone else for the crime. Such cover-ups are not unheard-of in Thailand. The fact that it didn’t fly this time suggests that patience for the antics of the uber-wealthy has run thin.

And it’s not just these two cases. In Singapore, in May, two accidents — at the same junction of Rochor Road and Victoria Street — occurred during the space of two weeks. Both times the drivers were allegedly trying to beat red lights. The second accident involved a 30-year-old Singaporean driver. But it is the first accident, which involved three fatalities, that is more poignant. The Ferrari driver, who died, was described as a 31-year-old Chinese businessman. Within a week of this accident, the wife of the driver blogged on Chinese sites: “We are neither guan er dai [second generation of officials] nor fu er dai [rich second generation],” squelching accusations that were already rampant.

The common thread — other than wealth, which is a given when a Ferrari is involved — is youth. The masses are increasingly angered by such behaviour, which they view as evidence of how disconnected the wealthy have become from the common man.

The truth is that such fast-and-loose partying has been going on for a long time. In fiction, it’s the basis for The Great Gatsby, while in the real world it is epitomised by the events at Chappaquiddick in the summer of 1969, when US senator Ted Kennedy drove his car off a bridge and into a channel on Chappaquiddick Island in Massachusetts. He swam to safety, while his passenger, Mary Jo Kopechne, drowned. The scandal is said to have been responsible for his decision not to run for president.

Fast cars and accidents are bad for politics. And while they’re probably not bad for business — at the very least, sports cars are a talking point and still do garner admiration among most men — the days of getting away with just about anything because you can afford one, are over.