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Huarong's ex-chairman accused of taking bribes of RMB1.65b

Beijing

LAI Xiaomin, the former chairman of China Huarong Asset Management Co who was arrested this week, is accused of taking 1.65 billion yuan (S$329 million) in bribes, said people familiar with the matter.

His case was discussed among top officials from the central bank and the banking regulator at the end of last month, said these sources, who asked not to be named because the deliberations were private.

Investigators have also found that Mr Lai owned 34 properties, three of the people said. The final amount of bribes he is determined to have taken could change.

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Huarong officials didn't reply to an e-mail seeking comment, and the China Banking and Insurance Regulatory Commission also didn't immediately respond to a fax seeking comment.

Mr Lai himself couldn't be reached.

He is next to face trial before a provincial court in the city of Tianjin, though no hearing date has been set.

The Chinese authorities have been taking an increasingly tough stance on corporate malfeasance, broadening President Xi Jinping's corruption crackdown into the nation's boardrooms.

As party chief and chairman of state-owned Huarong, Mr Lai was a public official, but private businessmen have also found themselves in the crosshairs as well, most notably former Anbang Insurance Group Co chairman Wu Xiaohui, who was sentenced to 18 years in prison in May for fund-raising fraud and embezzlement.

Mr Lai wouldn't be the first government employee to be charged with taking bribes totalling a billion yuan or more. Zhang Zhongsheng, a former vice-mayor of a city in China's Shanxi province, was sentenced to death by a provincial court in March for amassing bribes of that amount.

The authorities said in April that they were investigating Mr Lai for alleged "disciplinary and legal violations", language that's typically used in corruption cases.

He took over as chairman of Huarong in 2012, and ran it until earlier this year. Under his watch, assets ballooned six-fold to 1.87 trillion yuan in December, going by Bloomberg data.

Mr Lai, who previously worked at the central bank and China's banking regulator, used his position at Huarong to "give benefits to others in exchange for taking bribes, and illegally possessed state-owned assets", according to an official statement last month. He also made major corporate decisions without following rules and "interfered" in projects, the statement said.

Huarong was one of four companies set up by the government in 1999 to clean up a banking system riddled with bad debt. The state-owned enterprise held a US$2.5 billion initial share sale in 2015 that gave it a market value of more than US$15 billion. Its Hong Kong shares are now worth half that; in September, it withdrew plans for a listing in China. BLOOMBERG