Thread: Billionaire sentenced to prison

Chinese billionaire sentenced to prison

Updated 14m ago
By Calum MacLeod, USA TODAY

BEIJING — The rags-to-riches story of a Chinese billionaire just hit its bleakest chapter. Tuesday, a Beijing court sentenced Huang Guangyu, a high school dropout who founded China's equivalent of Best Buy, to 14 years in prison for "illegal business dealings, insider trading and corporate bribery," state news agency Xinhua reported.

Huang ranked No. 1 on the 2008 Hurun Report Rich List of China's wealthiest businesspeople compiled by Rupert Hoogewerf, a researcher in Shanghai. His fortune was estimated at up to $6.3 billion. Even after his detention, Huang was No. 17 on last year's list with a net worth of $3.4 billion.

Huang, 41, was fined $88 million and had assets worth $29 million confiscated. His wife, Du Juan, received a 3½-year sentence and a fine of $29 million, Xinhua said.

The verdict sends a strong warning to China's often freewheeling business barons. A string of prominent entrepreneurs have been jailed after running afoul of the law.

For several years, Huang and his 1,100-store company, Gome Electronics, were symbols of entrepreneurial success. A Hurun Report profile dubbed him "China's Sam Walton" after the founder of Walmart. He had the nickname "price butcher" for his business tactics.

From an early age, Huang appreciated the lure of low prices, according to a life story in the encyclopedia section of Baidu, China's top search engine. Born to poor farmers in south China, Huang helped recycle rubbish to get by. He dropped out of school at 16, and in 1986, he and his older brother used their $585 earnings and a $4,400 loan to open a clothes shop in Beijing. They soon moved into imported household appliances.

The retail giant Huang created remains a major player.

"Anyone with a very big business has skeletons in their closets," Hoogewerf says. "It's like the robber barons in the U.S. at the end of the 19th century, when the winners were ruthless and very canny."

The most surprising aspect of Huang's story is his failure to secure political cover, Hoogewerf says. To broaden its support, China's Communist Party has in recent years opened membership to businesspeople, once reviled as "capitalist roaders."

Huang enjoys some consolation as he begins to count the days until freedom. He still owns 34% of Gome.

http://www.usatoday.com/news/world/2010 ... coon_N.htm

They need to clean house here in America as well........