Corruption in China

Ex-railways chief Liu Zhijun meddled with projects worth 175b yuan, court hears

Liu Zhijun interfered with bidding for at least 53 deals from 2007 and 2010, Beijing court hears

PUBLISHED : Friday, 19 April, 2013, 12:00am
UPDATED : Friday, 19 April, 2013, 4:54am

Former railways minister Liu Zhijun interfered in the bidding for at least 53 projects worth a total of nearly 175 billion yuan (HK$217.8 billion) between 2007 and 2010, a Beijing court was told on Wednesday.

The Beijing News reported yesterday that Liu colluded with Shanxi businesswoman Ding Shumiao from the end of 2007 and granted railway projects to 23 state-owned firms Ding chose. Ding and her underlings consequently illegally obtained about 3.2 billion yuan, with about 2.4 billion yuan going to Ding alone.

Five of Ding's underlings, including her daughter Hou Junxia , stood trial at Beijing's No2 Intermediate People's Court on Wednesday charged with illegal business operation for their role as "middlemen" in the bidding process.

The hearing was closed to journalists.

The report said none of the defendants denied involvement, but they did dispute the charge.

If found guilty, they could be jailed for five to 15 years. However, if the charge was changed to bid-rigging, they would face a maximum of three years in jail.

Defendant Hu Bin , former chairman of a company based in Jiangxi , pleaded not guilty, the report said, citing his lawyer.

Ding will go on trial at the same court soon, while prosecutors have also charged Liu with corruption and abuse of power.

The Beijing Times reported that other railways officials implicated in Liu's corruption case would stand trial in Hebei.

In eight years as railways minister - until February 2011 - Liu oversaw a massive expansion of the mainland's high-speed rail network. But his legacy has been tarnished by numerous problems, including the accumulation of more than 2.6 trillion yuan in debt and a high-speed train crash in Wenzhou in July 2011 that claimed at least 40 lives.

Ding and her daughter Hou were previously caught up in a fraud case when, at Liu's behest, they tried to get former railways ministry official He Hongda lighter punishment on graft charges.

They were cheated out of about 40 million yuan by a woman who claimed to have strong ties to senior government officials and the ability to influence the judgment in He's case.