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Guo Wengui

Staff of fugitive tycoon Guo Wengui jailed, punished for fraud

Three senior employees of the Chinese billionaire wanted on graft charges had pleaded guilty to fraudulently obtaining loans and buying foreign currency

PUBLISHED : Friday, 16 June, 2017, 12:14pm
UPDATED : Friday, 16 June, 2017, 11:02pm

Three senior employees of the fugitive Chinese billionaire Guo Wengui were sentenced on Friday for fraudulently obtaining loans and buying foreign currency by a court in northeast China, state media reported.

The three executives at Guo’s flagship company Beijing Pangu Investment were instructed by the tycoon to use fraudulent means such as producing fake contracts and company stamps to obtain huge amount of loans, which had “disrupted the order of the country’s financial management and imperiled its financial security”, the Dalian Xigang People’s Court said in a statement.

Two of the executives also used falsified vouchers and receipts to obtain large amounts of foreign currency, the court added.

The three had pleaded guilty to the charges at the court last Friday.

Lu Tao, Pangu’s deputy general manager, was sentenced to 27 months behind bars on Friday.

Chief financial officer Yang Ying and Xie Honglin, a financial manager, were both handed a two-year jail term suspended for three years. It means that if they behave well over the three years they can avoid imprisonment.

The court said all three were given less severe punishments because they were instructed by their boss Guo to break the law and were considered accessories. Their truthful confession and repentance of their crimes also helped secure a more lenient sentence, the court said.

Exiled tycoon Guo Wengui ordered staff to commit fraud to get big loans, court told

Beijing Pangu Investment was fined 245 million yuan (US$36 million) by the court, the state-run news agency Xinhua reported. All three said they would not appeal, according to Xinhua.

Yang, Lu Tao and Xie admitted at the hearing last week that they produced fake contracts, company stamps and receipts to apply for a 3.2 billion yuan loan from the Agricultural Bank of China in 2010.

Lu and Xie also admitted that they produced a falsified contract and invoice to apply for foreign currency to the value of US$13.5 million for Guo to buy his second private jet.

Guo is wanted on corruption charges in China and is now based in the United States.

He has made a series of accusations in live-streamed broadcasts, media interviews and on social media since April accusing senior Chinese government leaders and company officials of graft.

Guo said during an interview with the overseas Chinese media outlet Mingjing last Friday that the charges heard at the Dalian court were “completely different from the truth as I know it”.

Guo’s allegations have created huge publicity in recent months and he now has about 250,000 followers on Twitter, but he has so far provided little evidence to back up his claims.

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He is China’s first billionaire insider who has spoken publicly about his connections to the politically powerful, especially his “friendship” to the former spymaster Ma Jian. He used to head the country’s intelligence service and is now facing corruption charges.

Beijing has launched a huge campaign through state media to discredit Guo, detailing its graft allegations against the tycoon and his links with corrupt officials.

Meanwhile, prosecutors are pressing charges against more of Guo’s companies, including Pangu, Beijing Zenith Holdings and another real estate company in Henan province, state media reported.

They are accused of crimes including the intentional destruction of accounting documents and fraudulently obtaining loans, Xinhua said.

Some suspects are also accused of bribery, embezzlement and false imprisonment, the report said.