x Abu Dhabi, UAESaturday 20 January 2018

Two executed as China fraud crackdown continues

International China has executed two people for defrauding hundreds of investors out of millions of yuan.

BEIJING // China has executed two people for defrauding hundreds of investors out of millions of yuan in beauty parlour, cosmetics and property scams, crimes which the government described as a serious blow to social stability. The two executed fraudsters, Du Yimin and Si Chaxian, "seriously damaged the country's financial regulatory order and social stability", the supreme people's court ruled.

Du, 44, a beauty parlour owner from Zhejiang province, was found guilty of conning more than 700 million yuan (Dh376.4m) from investors in a scam where she had promised them monthly returns of up to 10 per cent from beauty parlour, cosmetics, real estate and mining businesses. She spent much of the money on plush apartments, fast cars and other luxury items, the official Xinhua news agency reported.

Si collected 167m yuan from more than 300 people, saying they could receive interest of up to 108 per cent. Much of the money was still missing, the intermediate people's court in the eastern city of Hangzhou was told. This is the second case in China this year of a major fraud case involving a beauty parlour owner. Earlier this year, Wu Ping, who turned her beauty business into a multimillion-dollar property empire, was sentenced to death for running a pyramid scheme.

China executes more people than the rest of the world put together, although in recent months the country's top court has said it wants to use the ultimate sanction less readily. The numbers of executions are a state secret, but the Dui Hua Foundation, a rights group based in San Francisco that works to free Chinese political prisoners, says the figure in 2007 was between 5,000 and 6,000, compared with 8,000 the previous year. Execution is usually reserved for violent crimes but occasionally used for cases of major fraud, or offences that are seen to threaten social order.

Last month, Chen Tonghai, the former chairman of the Chinese oil giant Sinopec, was sentenced to death with a two-year reprieve, in what is believed to be China's biggest bribery case. Chen, 61, was convicted of illegally receiving 196m yuan between 1999 and June 2007, when he resigned abruptly as chairman of Sinopec. His mistress, Li Wei, was the owner of a property firm in Qingdao who bought land linked to a huge oil refinery project in the eastern Chinese city at prices lower than market value.

In November, the leader of a bogus scheme for breeding ants to make aphrodisiacs who conned investors out of 3 billion yuan was executed. The government is taking a tough line on white-collar crime of late, following a spate of corruption cases involving senior figures at state-owned enterprises and major companies. The ruling Communist Party has identified corruption as one of the chief dangers to single-party rule.

The head of China's nuclear power programme, Kang Rixin, was under investigation for "grave violations of discipline", language usually used to describe corruption. Mr Kang was general manager and also party boss of the state-owned China National Nuclear Corporation, which oversees the country's nuclear programmes and made a profit of 4.8bn yuan last year. In June, the former mayor of the southern boom town of Shenzhen, Xu Zongheng, was detained and sacked by central authorities for suspected graft. The province's top political adviser, Chen Shaoji, and the former head of Guangdong's anti-corruption body, Wang Huayuan, were also put under "shuanggui", a form of party discipline.

There were reports the cases were linked to a long-standing investigation into suspected financial misconduct by Huang Guangyu, the founder of GOME Electrical Appliances who was once ranked China's richest man. business@thenational.ae