China railway rogue trader gets death for fraud

(Reuters)
Updated: 2007-07-05 19:04

The former chief accountant of a railway authority in western China has been sentenced to death for fraud, after losing billions of yuan of public funds in failed investments, state media reported on Thursday.

Zhang Ning, top book keeper at the Lanzhou Railway Bureau from 2001 to 2005, and the ringleader of a consortium of banking, securities and investment company officials, had also amassed millions of yuan through taking bribes or "soliciting assets", the Beijing Youth Daily said.

Under Zhang, the railway bureau plunged 9.23 billion yuan ($1.22 billion) into stocks and other investments up to the end of 2004, the paper said. A total of 4.25 billion yuan in bank loans and nearly 2 billion yuan of the bureau's own funds had not been recovered, the paper said.

"During this period, Zhang Ning lost direction, confusing his own money with public money," the report said, citing the Procuratorial Daily, official mouthpiece of China's prosecutions office.

"In 2004, with the losses getting larger and larger, Zhang kept adding huge amounts of funds, hoping to recoup his losses," it said.

In December, Zhang lost his appeal against a death sentence pronounced by a court in May 2006, at which eight other defendants were jailed for terms ranging from eight years to life, the daily said.

In May, Zhang was found guilty, independently or in collusion with "partners", of taking 23 million yuan in bribes or "assets solicited from others", it added.

Zhang's death sentence requires final confirmation from China's Supreme Court, which took back its right to review death penalties this year, the paper said.

In a case reminiscent of the Shanghai social security fund scandal that broke last year and claimed more than a dozen officials including the city's Communist Party chief, a team of more than 100 investigators probed Zhang's case, the paper said.

Zhang was reported to have had no idea he was breaking the law until he was arrested, and had attributed the losses to "bad luck" and poor stock market conditions.

"Zhang had an indifferent conception of the legal system and lacked knowledge of the law," the paper quoted an unnamed source close to the situation as saying.

Last month, Shanghai's top court said that 6.3 billion yuan of the city's public funds had been illegally diverted into the Shanghai stock market between 2003 and 2006. It said large-scale embezzlements were threatening the domestic bourse's stability, state media reported.

($1=7.6 yuan)



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