An appliance retailer who was once China's richest businessman was sentenced to 14 years for insider trading and other crimes Tuesday, the latest in a series of Chinese tycoons jailed for financial offenses. Huang Guangyu built Gome Electronics into China's biggest appliance retailer and was estimated in 2008 to be worth $6.3 billion. His abrupt fall reflected the uncertain status of entrepreneurs in China, where an economic boom has created dozens of billionaires but complaints of misconduct are widespread.
A Beijing court also convicted Huang of bribing officials and unspecified "illegal operations," said a statement by prosecutors. The ruling was reported by state television on its national midday news, possibly as a warning to other businesspeople. A receptionist for Huang's lawyer, Tian Wenchang, said the defense team would not comment.
Accusations of bribery, tax evasion and the collusion of corrupt officials in financial abuses are common in China. Successful businesspeople often are linked to Communist Party figures and prosecutions can be prompted by political struggles, though it is unclear what triggered Huang's case.
Huang was charged with paying 4.6 million yuan ($675,000) in bribes to five officials and insider trading of Gome shares worth 1.4 billion yuan ($204 million), the state-run China News Service said. Earlier reports said he was accused of paying bribes to win approval of Gome's stock market listing in Hong Kong.
Huang might face additional problems. The government said in 2008 he also was suspected of share price manipulation, money laundering, illicit asset transfers and tax evasion. There was no word Tuesday on the status of those accusations.
Hong Kong authorities are looking into whether Huang diverted money from a Gome share buyback to repay a personal loan. Regulators say that caused Gome and its shareholders to lose 1.6 billion Hong Kong dollars ($207 million).
Huang's wife, Du Juan, is under investigation and Hong Kong has frozen their assets there.
State media had celebrated Huang's success as representative of reforms launched by then-supreme leader Deng Xiaoping in 1979 that allowed millions of Chinese to lift themselves out of poverty.
Born in Shantou in the southern province of Guangdong, near Hong Kong, Huang came to Beijing as a teenager and became a clothing trader.
He switched to appliances, jumping on a retailing boom as Chinese families bought refrigerators, televisions and washing machines. Gome has grown to more than 1,100 stores and employs 300,000 people.
Huang also had extensive real estate holdings and dabbled in private equity.
Gome said earlier its chief financial officer, Zhou Yafei, was under investigation but no details of his case have been released.