'Hotel king' among 47 tried over Chinese town's sex trade

Boss of city's five-star Crown Prince Hotel, once one of China's richest men, denies masterminding prostitution network, but 43 plead guilty

PUBLISHED : Wednesday, 27 May, 2015, 11:17pm
UPDATED : Thursday, 28 May, 2015, 11:52am

Dongguan's 'hotel king' Liang Yaohui pleaded not guilty to a charge of organising prostitution in a high-profile trial involving 46 others accused of turning the Guangdong city into the nation's top destination for sex.

Liang - who was once listed among China's 500 richest people - faces a possible death sentence due to the scale of his alleged crimes. All of the accused were either stakeholders or employees at the city's five-star Dongguan Crown Prince Hotel, established in 1995, and the most recognisable name of the thousands of venues shut down in a months-long campaign that kicked off in February last year.

Twenty-eight defendants besides Liang have been charged with organising prostitution, 16 others are accused of facilitating the crime, while two more allegedly helped to destroy evidence, as much as two truck-loads.

The trial is being conducted by the Intermediate People's Court in Dongguan and is expected to be a lengthy, complicated procedure. Liang is among four defendants who have denied the charges - the rest pleaded guilty.

China News Services reported the hotel generated nearly 49 million yuan (HK$62 million) in illegal income in 2013 alone, and that Liang and others were responsible for 100,000 incidents of prostitution, which also involved minors. Those accused of large-scale organisation of sex workers face life imprisonment or the death penalty, and confiscation of all their assets.

The Crown Prince Hotel offered 99 sauna massage rooms and retained more than 100 sex workers at any one time, mainland media have reported. It was targeted by prosecutors partly because it's one of the oldest luxury hotels in Dongguan but also due to its reputation for offering naked dance shows during which customers could select a woman.

Apart from running the Crown Prince, Liang is also director of Energy China Group, a mainland company focused on developing overseas oil.

Liang, 48, began his career as a hairdresser while in his 20s, opening a salon which employed more than 50 women who allegedly offered sex services.

The Dongguang vice trade began to pick up in 1995 when the manufacturing sector of the Pearl River Delta boomed, drawing Taiwanese and Hong Kong businessmen to the city.

Liang's fortunes allegedly rose along with it, and by 2008, he was listed among China's richest, with assets estimated at 2 billion yuan. As of 2010, he had given 56 million yuan to community projects, mainland media has reported.

The crackdown saw at least 36 city police officials, including Yan Xiaokang, former deputy mayor and head of the local public security bureau, suspended or removed from office on suspicion of having protected businesses involved in prostitution.

Some 1,200 websites and more than one million public instant-messaging accounts were closed for promoting sex services online. The campaign targeted the businesses of many taxi drivers and the bosses of saunas and restaurants.

Prostitution became a significant part of the economy in the city after manufacturing industries closed or shifted elsewhere when export demand slumped in 2009 following the global economic crisis.

No one knows exactly how many people worked in the sex industry in Dongguan. Local analysts estimated there were more than 250,000 prostitutes working in the city at one point, and the business generated about 50 billion yuan (HK$63 billion) a year.

The sex trade continues to exist in the city, some of it openly, but the security sweep has driven significant portions of it deeper underground.