The most recent FCPA and anticorruption enforcement developments involving the People’s Republic of China (PRC) are summarized below. Thanks as always to Squire Sanders’ Shanghai Office for monitoring these enforcement actions.
1. New Law or Regulation
State level: No developments
Local level (Beijing & Shanghai): No developments
Communist Party Rules: No developments
2. Upcoming Law or Regulation
3. Government Action
(1) On February 8, Huang Ping (“Huang”), the former Director of the Transportation Bureau Branch of Humen Town, Dongguan City, Guangdong Province was sentenced to 18 years in prison, fined RMB 20,000 (USD 3,214) with confiscation of RMB 700,000 (USD 112,497) of personal assets by Dongguan City No.1 People’s Court for corruption and rape.
Huang was charged with taking bribes totaling RMB 2,150,000 (USD 345,526), embezzling public funds involving RMB 1,760,000 (USD 282,849) either on his own or together with others, dividing the state owned assets worth RMB 412,000 (USD 66,212), and one count of rape. Eight of Huang’s former subordinates received prison sentences from three to seven years. According to press reports, the case involved the most defendants, the widest scope, and the largest amount of money ever handed by the Dongguan City No.1 People’s Court in a breach of duty case.
(2) On February 16, Liu Baolu (“Liu”), the former Deputy Head of Agricultural Reclamation Social Insurance Office, Gansu Province, was reportedly sentenced to death with two years’ reprieve by the Intermediate People’s Court of Lanzhou City, Gansu Province for embezzlement. This final judgment affirmed the original judgment made on July 25, 2012. A death sentence with a two-year reprieve is typically reduced to life in prison if the convicted person behaves well while serving the term.
Liu was accused of diverting public funds into secret accounts and embezzling large amounts of money by using fake receipts and telegraphic transfer statements involving RMB 28 million (USD 4.5 million) during his term of office from 2002 to 2011. The amount of embezzlement involved is reported to be the largest individual corruption case investigated by Gansu prosecutors to date.
(3) On February 16, Xing Baojiang (“Xing”), the former Deputy Director of the Xinhua Sub-District Administration of Tongzhou District, Beijing Municipality was sentenced to twelve years in prison by Tongzhou District People’s Court for corruption.
During his term in office from 2008 to 2010, Xing abused his position to embezzle the real estate of Yu Mou, an elderly person with no family, obtaining illegal gains worth more than RMB 1,062,200 (USD 170,706), most of which was used by Xing to purchase a house. Xing was also found guilty of instigating others to obtain public funds and privately dividing the funds worth RMB 102,600 (USD 16,488).
(4) On February 19, Liu Zhihe (“Liu”), the former Vice President of the Nanchang Hangkong University (“NCHU”), was sentenced to 15 years in prison and deprived of political rights for two years by Xinyu City Intermediate People’s Court, Jiangxi Province for taking bribes.
Reportedly, during his term as the Vice President of the Nanchang Institute of Aeronautical Engineering (the former NCHU), the general director of the NCHU’s new campus construction project and vice principal of the NCHU, Liu took advantage of his position to receive properties from twelve individuals on forty-one occasions, totaling RMB 2.6 million (USD 417,846). In return, he offered them help in project construction, construction fund payment and job arrangements.
(5) On February 20, Lin Jia (“Lin”), the former Director of the Xiuying Branch of Haikou City Public Security Bureau, Hainan Province was sentenced to eight years in prison with his personal assets confiscated worth RMB 60,000 (USD 9,642) by Haikou City Intermediate People’s Court, Hainan Province for taking bribes.
Lin was charged with abusing his position to accept properties amounting to RMB 1,555,000 (USD 249,904) from nine individuals during his term with Xiuying Branch of Haikou City Public Security Bureau. Lin voluntarily surrendered himself to justice before being investigated. He confessed the facts and his principal crimes after being investigated. This was regarded by the authorities as a voluntary surrender. That coupled with the fact that he handed over bribes worth RMB 1,260,000 (USD 202,494), resulted in Lin receiving reduced punishment under the law.
5. China-Related FCPA Action