Chinese ex-official admits to making US$23 million from insider trading
- Former vice-governor of Guizhou province pleads guilty to engaging in illegal share trades for more than six years
- Wang Xiaoguang, 57, also admitted to charges of accepting bribes and corruption. He will be sentenced at a later date
A former provincial vice-governor in southern China has pleaded guilty to engaging in insider trading and making 160 million yuan (US$23.2 million) on illegal trades over the course of more than six years.
Wang Xiaoguang, 57, also admitted to charges of accepting bribes and corruption when he stood trial on Thursday, the Chongqing First Intermediate People’s Court said.
From August 2009 to February 2016, Wang used his position to obtain inside information that he and his relatives used to make illegal share transactions to the tune of 490 million yuan, according to court documents. He will be sentenced at a later date.
Wang held various positions in the Guizhou government during that period, becoming vice-governor in June 2017 before he was dismissed in March this year when he was placed under investigation by the party’s graft-buster. He was expelled from the party in September.
He also has links to another disgraced official, Wang Sanyun, 66 – the former party chief of Gansu province who pleaded guilty to taking 66.8 million yuan (US$9.7 million) in bribes when he stood trial in October.
The two men are both from Heze, in Shandong province, and went to the same teachers’ college in the Guizhou capital, Guiyang. Wang Xiaoguang went on to become Wang Sanyun’s secretary when he was the party chief of Guiyang.
Prosecutors also alleged that Wang Sanyun had taken bribes from Ye Jianming, the former boss of CEFC China Energy who vanished from public view in March. Wang Sanyun also awaits sentencing.
While the scale of Wang Xiaoguang’s insider trading has caught attention in China, so too has his Mao-tai sideline. The anti-corruption watchdog said he had amassed so many bottles of the Chinese spirit baijiu through his official duties that he began selling them – obtaining liquor licences for his relatives to run four stores in Guiyang.
His wife had to pour away “hundreds” of expensive bottles of baijiu before the agency closed in, according to Anti-Corruption Watch, published by Sichuan Daily.
Wang Xiaoguang is just the latest Chinese official to be prosecuted for insider trading. But according to a search of court documents, Wang’s illegal trades top the list in terms of total transactions of any officials found guilty of insider trading in China.
However, his illegal gains from insider trading were surpassed by those of Zhou Chunyu, the 50-year-old former vice-governor of Anhui province. In October, Zhou pleaded guilty to charges of bribery, abuse of power, concealing foreign deposits and insider trading, with prosecutors putting his profits from illegal trades at 350 million yuan. Zhou is also yet to be sentenced.
That trial came after Zhou’s colleague and vice-governor of Anhui, Chen Shulong, in July admitted to taking bribes, abuse of power and insider trading. Prosecutors said his illegal gains from those trades totalled 137 million yuan. Chen also awaits sentencing.
These provincial officials are some of the many cadres who have been netted in a nationwide anti-corruption drive announced by President Xi Jinping in 2012 that has snared more than 1.3 million party officials at various levels of government – from the powerful “tigers” to low-ranking “flies”.
The biggest “tiger” found guilty of insider trading was Yao Gang, the former vice-chairman of the China Securities Regulatory Commission, who was jailed for 18 years in September – nearly three years after he was put under investigation in the aftermath of a stock market collapse.
Yao pocketed 2.1 million yuan from insider trading, and was also found guilty of taking 69 million yuan in bribes. As well as the prison term, he was fined 11 million yuan.