Associates of fugitive Guo Wengui confess to financial crimes

By Bai Tiantian in Dalian Source:Global Times Published: 2017/6/9 22:43:39

Photo: Courtesy of Dalian Xigang District People's Court

Photo: Courtesy of Dalian Xigang District People's Court

The chief executives who served under fugitive billionaire Guo Wengui stood trial on Friday in a court in Dalian, Northeast China's Liaoning Province for fraudulently obtaining loans and foreign currency.

They confessed in the court to fabricating contracts and other financial documents at Guo's orders.

The trial is the first of a series of upcoming legal hearings related to Guo after he fled China in 2015. Guo was involved in multiple corruption cases. He is the controlling shareholder of Beijing Zenith Holdings and Beijing Pangu Investment Co Ltd.

The executives tried Friday included Yang Ying, a former financial officer at Beijing Pangu Investment, Lü Tao, former deputy general manager of Pangu Investment, and Xie Honglin, another former financial officer at Pangu.

The trial started at 8:30 am at the Xigang District People's Court in Dalian. The hearing was broadcasted live on the Sina Weibo account of the Xigang district court.

According to the indictment, which was made public on the court's Weibo account, Guo had demanded Yang, Lü and Xie to fabricate contracts with a construction company called Cheng Jian Wu and forged seals of that company in order to obtain a loan from Agricultural Bank of China. The indictment also said Guo's Pangu Investment submitted falsified receipts showing that the loan had been received by Cheng Jian Wu but in fact the money had been directed back to Pangu's bank accounts, which shows the loan was spent on projects different than originally stated.

According to financial magazine Caixin, the downfall of China's top insurance regulator, Xiang Junbo, is allegedly related to Guo. Caixin quoted anonymous sources as saying that Xiang, then board director of Agricultural Bank of China, approved a loan worth 3.2 billion yuan ($470 million) to Guo's company in 2010.

Prosecutors also charged Lü and Xie with fraudulently obtaining foreign exchange totaling $13.5 million from the Bank of Communications by using falsified furniture import contracts and invoices in 2012. A company controlled by Guo Qiang, the son of Guo Wengui, was used in the fraud.

The money was later transferred to a Hong Kong company for Guo Wengui to buy a private jet.

The indictment said Guo Wengui and Guo Qiang would be dealt with in separate cases.

During Friday's trial, evidence including witness statements and expert opinion were presented. The defendants did not object to any criminal facts and charges from prosecutors. All three plaintiffs pleaded guilty in the court. Yang and Xie burst into tears when they made the final confessions.

The defendants asked for leniency, saying their actions were made at the instruction or suggestion of Guo Wengui.

Xie told the court that he felt his acts might "violate some rules." However, he said he did not refuse as "my boss told me to do it, so I just followed."

The trial adjourned at around 12.30 pm and the judge announced that the verdict will be announced at a later date.

Over 40 people, including families of the defendants, legislators, political advisors and journalists from domestic and overseas media, as well as members of the public, attended the hearing.

Friday's trial is the first court proceeding on a series of cases involving the Beijing Pangu Investment and Beijing Zenith Holdings.

Other cases involving offering bribes, forced transactions, duty-related encroachment, embezzlement, destroying accounting documents and unlawful detention are being handled according to the law. 

 'Hunter of power'

The Chinese foreign ministry confirmed in April that Interpol had issued a "red notice" for Guo.

Guo's manipulation of senior officials, either through money, sex or blackmail, was revealed by Caixin magazine in a series of reports in 2015, in which Guo was characterized as "the hunter of power."

His legend dates back to a 2006 graft case in which, in order to secure a key land development project in Beijing, Guo toppled the former vice mayor of Beijing, Liu Zhihua, by sending authorities a sex tape of Liu and his mistress.

His downfall and exile in 2015 was allegedly caused by a feud with his former partner Li You, then CEO of conglomerate Founder Group. Li narrowly escaped police arrest in December 2014, and in turn, reported Guo and Ma to China's discipline watchdog, Caixin reported.

Though Guo has since blasted the reports, some details of the reports were recently confirmed by a videotaped confession, apparently given by Ma Jian, former deputy minister of state security.

Xinhua contributed to the story.


Newspaper headline: Executives stand trial in graft case


Posted in: LAW

blog comments powered by Disqus