2012-02-07

Social mood in China: Executed for regulatory violations? Chinese citizens rage on the Internet

China: A Death Sentence to Hide Government Corruption?
Wu Ying, named China’s sixth richest woman in 2006, lost an appeal against her death sentence at the Zhejiang Higher People’s Court on January 18, 2012. Many citizens have pleaded online for Wu’s life believing the death sentence was meant to silence her from exposing corruption by government officials who may have loaned her embezzled public funds.

Suspicions grew stronger when Dong Yang City government submitted a joint letter to the courts recommending she be executed.

The 30-year old was first arrested in March 2007, charged with “illegal fundraising” of RMB 770 million (approximately USD 122 million). In December 18, 2009, the charge was changed to “financial fraud”, and she was sentenced to death by the Jinhua Intermediate People’s Court. In Wu’s first trial, there was no lawyer to represent her, and all trials including the appeal took place behind closed doors.
Note that after social mood changed, her charge was greater. In the interim, the government auctioned off her investments and if it happened during the financial crisis, the losses would have been very great. Thus, it's a text book case of a change in social mood leading to a change in perception. She was a rich, celebrated successful woman who ended up executed by the state.

From everything I've read about this case and the fact that the woman does not seem to have a PR machine spinning her story (as you's likely find in the U.S.), I'm pretty sure that she was executed for illegal fundraising. However, illegal in this case means she violated regulations, from what I've read she didn't steal money. Of course, Wu Ying was involved in the type of loan-sharking activity that led to the fleeing of Wenzhou bosses: Debate Rages in China as Death Sentence Upheld for Young Tycoon
According to state media reports, Ms. Wu’s was found guilty of “fraudulent fundraising” after she collected as much as 770 million yuan with promises of 80% annual interest-rate returns. Prosecutors said she told her investors she would use the money to start companies, extend loans or improve cashflow at existing businesses but instead used it roll over debt and fund personal purchases of real estate and cars. Ms. Wu lawyers say she used the funds to invest in trading companies, hotels and property developments, and that her investors were friends and not the general public.
Chinese citizens are naturally angry, since by the standards used for her execution probably half of China's officials and many state-owned company executives would qualify for execution. Also, economists and business leaders have said that without the private fundraising market, many businesses would be shut out of credit markets due to government policies that benefit state owned coroporations.

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