'Great leap Liu' gets life for $635m theft

By Malcolm Moore

China's Communist party has struggled for two-and-a-half years to decide what to do with Liu Zhijun, the high-speed rail supremo who embezzled $635 million.

In nine years the 60-year-old farmer's son transformed a decrepit rail system where trains chugged at an average of 50km/h into the world's largest high-speed network with 10,000km of track and 320km/h bullet trains. The speed of the change earned him the nickname "Great Leap Liu".

But at the same time, Liu was presiding over one of the greatest thefts in Chinese history, in which billions disappeared into thin air.

And his focus on speed resulted in two bullet trains colliding in 2011, killing at least 40 and injuring 192.

In the end, after a brief show trial, Liu was spared immediate execution, the usual penalty for such a crime, and can expect it to be commuted to life.

"There are many officials who give Liu a lot of credit for what he achieved," said Wu Qiang, a professor of politics at Tsinghua university. "They think he was capable and ... that he has been the victim of political infighting."

Providing he keeps co-operating with the authorities, Liu can expect his sentence to be commuted to life in a relatively comfortable prison.

"You can tell the Government never wanted to execute him by the way in which they only included a small amount of the evidence against him in the trial," said one source familiar with his case, who declined to be named because of the sensitivity of the matter.

Two sources with close connections to the Railways Ministry said Liu was treated leniently because of his ties to Hu Haifeng, the son of former Chinese president Hu Jintao and to Wang Xinliang, the son of former Politburo member Wang Zhaoguo.

In 2005, Mr Liu signed deals with NucTech, a technology company headed at the time by Hu Haifeng, on behalf of the Railways Ministry.

Others believe Liu is under the protection of ex-President Jiang Zemin.

The court also ordered the seizure of Liu's assets. So far, investigators have found he owned 374 houses, 16 cars, paintings, jewellery and at least 800 million yuan ($168.6 million) in cash.

But his true wealth may have been far greater and almost all the properties that investigators did find were held under the names of intermediaries.

"One of my clients, a property developer in Qingdao, said he had given two houses to Mr Liu but never formally transferred the deeds. Liu used them to house a couple of his mistresses," said one lawyer.

In a move which seems designed to help Liu escape the death penalty, most of his assets were treated by the court as the property of one of his intermediaries, a businesswoman named Ding Shumiao.

"If he had been charged with the full extent, he would have been executed, there was no escape for him," said the source familiar with his case.

Details leaked into the Chinese media included a claim that a £5 million ($9.6 million) TV adaptation of the classic Dream of the Red Chamber was funded partly in order to allow Liu to sleep with some of its 23 actresses.

Liu's verdict will deal a blow to the credibility of an anti-corruption campaign by President Xi Jinping, said Joseph Cheng, a politics professor in Hong Kong.

- Daily Telegraph UK

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