Ex-Communist Party boss sentenced to 18 years
in China corruption case involving pension funds

The Associated Press

SHANGHAI, China — The former Communist Party chief of China's financial capital was sentenced Friday to 18 years in prison for his role in a massive corruption scandal involving a third of the city's pension funds.

Chen Liangyu, who also was a member of China's powerful 24-seat Politburo, was the highest-level Chinese official to be dismissed in a decade. The official Xinhua News Agency said Chen was locked up "for taking bribes and abusing power."

His lawyer, Gao Zicheng, could not immediately be reached after the sentencing. When reached on his way to court, Gao said "Chen is good" and that his wife and child would be with him in Tianjin No. 2 Intermediate People's Court for the sentencing.

The party chief in Shanghai, China's largest and richest city, is one of the country's most powerful local government jobs. The man who replaced Chen, Xi Jinping, has already been promoted again and is widely seen as being moved into position to be China's next president.

Chen is accused of being at the center of a high-profile scandal in which more than $400 million in pension funds were improperly invested in real estate and toll road projects that included Shanghai's new Formula One race track.

Chen was accused of lending large amounts from the pension fund and helping businessmen buy stakes in state-owned companies, resulting in huge losses.

He was expelled from the Politburo and from the party after being dismissed as Shanghai's top leader in September 2006.

The scandal investigation, which snared more than 25 local officials, has been widely viewed as part of President Hu Jintao's efforts to shove aside supporters of former President Jiang Zemin, whose political base was Shanghai.

Chen was among Jiang's most powerful allies. He reportedly clashed with Premier Wen Jiabao over Beijing's efforts to cool economic growth, lobbying instead for ambitious infrastructure projects.

Earlier this month, Shanghai tycoon Zhang Rongkun, reported by Forbes to be China's 16th-wealthiest businessman in 2005, was sentenced for his role in the scandal to 19 years in prison for bribery, share price manipulation, financial fraud and misuse of public funds.

In January, the former Formula One racing boss in China, Yu Zhifei, was sentenced to four years in prison for embezzlement for his own role.

In December, a Web site created by China's newly created anti-corruption bureau crashed after barely a day because too many visitors tried to log on to register complaints.

Nearly 2,000 local government officials were either disciplined or charged with crimes last year, the Xinhua News Agency reported in late December, citing the Communist Party's organization department.
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