The punishment in the politically sensitive case against Chau Ching-ngai is seen as lenient Disgraced property tycoon Chau Ching-ngai was yesterday jailed for three years for manipulating stock prices and falsifying registered capital. The jail term amounts to less than half of the maximum penalty, legal experts said. Chau has been in custody for a year over charges stemming from the operation of his flagship company Shanghai Nongkai Development (Group) and its subsidiaries. Prior to his arrest, Chau ran a vast business empire ranging from luxury residential buildings to a hotel which once made him the mainland's 11th richest person. The Shanghai No1 Intermediate People's Court also ordered Nongkai to pay 40 million yuan in fines, including 33 million yuan for manipulating share prices and seven million yuan for falsifying capital, Xinhua said, quoting officials from the Supreme People's Court. Last month Nongkai said its operations were normal, but analysts say the size of the fines brings its future into question. Tao Wuping , Chau's lawyer, said his client did not plan to appeal the sentence, though he had 10 days to decide. Mr Tao said the crimes could have carried a combined sentence of eight years in jail. The court announced the sentence yesterday, less than two weeks after holding a one-day trial. Chau was sentenced to 21/2 years for stock manipulation and one year for falsifying capital but the court decided to combine the sentence to a total of three years, Xinhua said. The sentence does not take into account the year Chau spent in custody. It also sentenced two other people in the case, the report said. The case is considered to be politically sensitive given Chau's alleged ties to government officials. Chau caused more than a 400 per cent rise in the stock price of Shenzhen-listed Xuzhou Construction Machinery Group between mid-1999 and 2003, at one point holding most of the stock, Xinhua said. He also falsely declared 700 million yuan in registered capital for the group. Mo Yuk-ping , Chau's wife, is awaiting trial in Hong Kong on charges of stock manipulation during her tenure as general manager of the listed Shanghai Land Holdings. The group's other Hong Kong-listed company is Shanghai Merchants Holdings. Shanghai has tried to play down the property scandal, which threatened to implicate local officials. Two groups of residents suing the Jing'an district alleged that Chau had colluded with local officials to get land for free without providing compensation for people evicted for a property project, but they eventually lost their cases. A lawyer advising them, Zheng Enchong , was jailed for three years last October for contacting a US human rights group about property disputes in the city. A foreign diplomat said the government appeared to have charged Chau with lesser crimes rather than address the issue of possible corruption. 'They managed to avoid the whole property issue which is the political hot potato,' he said. After the scandal broke in late May last year, the government announced steps to make land sales more transparent and provide more low-cost housing.
