Relatives of China’s premier Wen Jiabao control assets totaling $2.7 billion, the New York Times reported. The newspaper traced 80 percent of the money to members of Wen’s extended family.
The Times said it used public records and information from unidentified sources to sort through the family’s apparent attempt to conceal the assets via a network of partnerships and shell companies.
Partnerships controlled by relatives and associates of the Wen family profited by investing in shares of Ping An Insurance Co. prior to its 2004 IPO, the Times story said. In 2007, the shares were worth as much as $2.2 billion.
In addition, the newspaper reported that Wen’s wife Zhang Beili — dubbed China’s “diamond queen” for her role in regulating the nation’s gemstone and jewelry trade — and her relatives built up a highly profitable investment portfolio with the help of tycoons eager to cultivate connections with the Wen family.
About the premier’s brash deal-maker son Winston Wen, principal of the leading private equity fund New Horizon Capital, an unnamed Times source said, “He’s not shy about using his influence to get things done.”
The Chinese government blocked access to the New York Times website after the story was published. Bloomberg’s website was similarly blocked in China four months ago after the news agency published a story about wealth accumulated by relatives of president-in-waiting Xi Jinping.
In a rare public response to a foreign news story, a spokesman for China’s Foreign Ministry claimed the Times report “blackens China’s name and has ulterior motives.”
Two lawyers representing the Wen family issued a statement denying the existence of “hidden riches,” and saying they reserve the right to hold the newspaper legally responsible for “untrue reports.”
Sources: The New York Times, BBC News, Bloomberg
Benjamin Kessler is a contributing editor of the FCPA Blog. He’s the managing editor of the members area of the FCPA Blog and the editor of the China Compliance Digest.
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