China’s Founder Group CEO fined $100 million for insider trading
A technology company CEO who may have given a Chinese politician’s son the Ferrari in which he crashed and died was jailed for nearly five years and fined more than USD 100 million for insider trading, court documents showed on Friday.
A dozen former executives of major Chinese technology conglomerate Founder Group, including CEO Li You, were convicted of insider trading and other offences, said the intermediate people’s court in Dalian, in northeastern China.
Li was sentenced to four and a half years in prison and fined 750.2 million yuan (USD 108.5 million), it said.
The Founder Group was established in 1986 with investment from Peking University and has expanded into IT, healthcare, real estate, finance, and commodities trading. According to the Beijing News, Li and Wei Xin, former chairman of the company, were linked to fallen Chinese presidential aide Ling Jihua, who was jailed for life in July for corruption, illegally obtaining state secrets and abuse of power.
An ex-aide of former president Hu Jintao, Ling was brought down in the high-profile corruption crackdown by current President Xi Jinping that has deposed several senior officials.
Chinese media have previously quoted reports saying that Li gave Ling’s son Ling Gu a Ferrari.
Ling Gu was killed in a high-speed crash in Beijing in 2012, when two women passengers, were injured, a scandal that helped trigger his father’s downfall.
Ling Jihua asked for and accepted over 6.43 million yuan from Wei, Xinhua said, and was aware of payments from Wei to his son.
The Founder executives were charged with insider trading, hiding financial information, and obstructing official business, with no accusations relating to Ling.