China’s Self-Made Tycoon Sentenced
BEIJING (AP) _ Mou Qizhong, a businessman once billed as China’s richest man, was sentenced today to life in prison for fraud, state television said.
Mou, president of the Land Group, was convicted by the Intermediate People’s Court in Wuhan city, in central Hubei province, of fraudulently using letters of credit, state television reported. Land Group was fined $603,000 and an unspecified number of Mou’s business associates were also sentenced to prison terms, the report said.
For a decade, Mou fascinated the Chinese press with his flamboyant style that seemed to typify the frenetic changes and enormous possibilities of China’s reform era.
Mou became famous in 1989 by swapping 500 freight cars of factory-surplus socks, shoes and other goods for four Tu-154 Soviet passenger planes, netting $25 million. He used his riches to fund ventures that kept him in the public eye, from soccer clubs to a North Pole scientific expedition.
For some in China, Mou’s downfall was a cautionary tale about the difficulties private businesses face in a socialist system. For others, it illustrated how weak accounting rules make it possible for a person with grand schemes to pile up loans without making money.
State television reported that Mou’s company turned to fraud after it had trouble obtaining loans because of a government squeeze on credit in 1995. It said the Land Group illegally obtained 33 letters of credit from a Bank of China branch in Hubei.
The case caused $35 million economic losses, the television said. It said Mou was identified as a main culprit.
Mou had pleaded innocent at his one-day trial last November. The report did not say why the court needed six months to deliver its verdict.