Ex-staffers of fugi­tive Guo plead guilty to loan fraud

China Daily (Hong Kong) - - FRONT PAGE - By CAO YIN in Kaifeng, He­nan caoyin@chi­nadaily.com.cn

Three former ex­ec­u­tives of fugi­tive Chi­nese bil­lion­aire Guo Wen­gui pleaded guilty to fraud­u­lently ob­tain­ing loans and banker’s ac­cep­tances — a type of short-term debt — dur­ing a trial in Kaifeng, He­nan prov­ince, on Wed­nes­day.

The three de­fen­dants, Zhang Xincheng, Guo Li­jie and Xiao Yan­ling, who worked for He­nan Yuda Real Es­tate Co, con­trolled by Guo Wen­gui, con­fessed to fraud­u­lently ob­tain­ing loans and banker’s ac­cep­tances over 44 times from seven banks by reg­is­ter­ing shell cor­po­ra­tions, forg­ing con­tracts and em­ploy­ing fake in­vest­ment projects from 2008 to 2015.

Nearly 1.5 bil­lion yuan ($221 mil­lion) was stolen through the trans­ac­tions, pros­e­cu­tors said, adding that while most of the money was re­turned, 212 mil­lion yuan was still miss­ing.

Some of the money was used to op­er­ate Bei­jing Pangu In­vest­ment Inc, also con­trolled by Guo Wen­gui, while some was trans­ferred over­seas, pros­e­cu­tors said.

“It was Guo Wen­gui who asked me to se­cure the loans and banker’s ac­cep­tances. I had lit­tle le­gal aware­ness and obeyed his or­ders blindly,” Zhang, former fi­nan­cial di­rec­tor of the com­pany, said in court.

Guo Li­jie, the com­pany’s former deputy man­ager, and Xiao, the ex-deputy head of the com­pany’s fi­nan­cial depart­ment, also pleaded guilty to the charges. “I felt sorry and re­gret­ted a lot what I did, which not only made me lose my free­dom, but also harmed my fam­ily. I’d like to ac­cept the pun­ish­ment,” said a weep­ing Guo Li­jie.

Lawyers of the three de­fen­dants said their clients played small roles in the schemes, sug­gest­ing they de­serve le­nient treat­ment.

“Most of the money fraud­u­lently ob­tained has been paid back, and it didn’t cause the banks great losses,” Zhang’s at­tor­ney said.

The Kaifeng In­ter­me­di­ate Peo­ple’s Court posted in­for­ma­tion about the trial, in­clud­ing pho­tos and videos, via its of­fi­cial ac­count on Twit­ter­like Sina Weibo. More than 60 res­i­dents, such as rel­a­tives of the de­fen­dants, jour­nal­ists and po­lit­i­cal ad­vis­ers, at­tended the hear­ing.

The court said it will an­nounce verdicts at a later date.

It was the sec­ond set of tri­als re­lated to Guo Wen­gui, who fled over­seas about three years ago.

In June, three former em­ploy­ees of Bei­jing Pangu were given prison terms in a court in Dalian, Liaon­ing prov­ince, for fraud­u­lently ob­tain­ing loans and for­eign cur­rency val­ued at 3.2 bil­lion yuan from the Agri­cul­tural Bank of China in the name of the com­pany.

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