Sichuan tycoon accused of criminal enterprise

Editor's note: Liu Han, a mining tycoon in Sichuan province, and 35 purported gang members were charged with killing nine people, as well as with blackmail, illegal detention and other crimes, by the Xianning People's Procuratorate in Hubei province on Thursday. The following article from Xinhua News Agency details the alleged crimes.

Rumors have circulated since last March that mining tycoon Liu Han had disappeared.

Liu was elected political adviser in Sichuan province three times in a row and has more than 20 honorary titles. His best-known charitable act was the building of a rural elementary school complex that withstood the devastating 2008 Sichuan earthquake.

He is chairman of the board of Hanlong Group, the biggest private enterprise in Sichuan, and of the listed Jinlu Group. He owns subsidiary companies involved in electricity, energy, finance, mining, real estate and securities. Estimates put his worth in the tens of billions of yuan.

The Ministry of Public Security ordered police in Beijing, Hubei and Sichuan to investigate Liu in March last year, and bring to justice the alleged leader of a Mafia-style criminal group.

The news of the prosecutions has sent tremors through Sichuan's political and business circles.

Liu's case first attracted attention with a murder case on Jan 10, 2009, in Guanghan, Sichuan. At an open-air teahouse in the downtown area, several men got out of a car, fired at least 10 shots and killed three people before escaping in the same car. Two pedestrians were injured.

The two suspects, Yuan Shaolin and Zhang Donghua, were soon captured and named Liu Wei, Liu Han's brother, as the mastermind of the killing. By then, Liu Wei had already absconded and became the most wanted man by police.

Liu Wei was boss of Guanghan Yiyuan Industrial Corp and a popular entrepreneur and philanthropist; and even a torchbearer for the Beijing Olympics in August 2008.

However, to those who knew him, Liu Wei was a ruthless underworld kingpin who controlled gambling, loan sharking and construction projects. Chen Fuwei, one of the men slain in the teahouse, was Liu's sworn enemy.

The police received tips on Liu Wei's whereabouts from time to time in the ensuing four years, but he slipped away each time, thanks to his big brother, Liu Han, they said.

Liu Han was born in 1965. In the early 1990s, he and Liu Wei ran gambling centers in Guanghan. At that time, the brothers mustered a gang of local thugs and vagrants.

In 1993, they openly broke a seal on properties that had been seized by the court and used guns against law enforcers. The same year, Liu Han fraudulently obtained a loan that he used to do business before his fortune began to accumulate.

In 1998, one of Liu Han's companies waded into a real estate development project in Mianyang, Sichuan's second-largest city. After a confrontation with villagers over demolition compensation, Tang Xianbing, a security guard with Liu Han's company, stabbed and killed Xiong Wei, the leader of the protesters.

"Nothing happened to me after the killing, and that made me bolder and more unscrupulous," Tang later confessed to police. "I would do anything for the company, even murder. I was fearless."

Silenced by the murder, the villagers made way for the property project.

Five days after the killing of Xiong Wei, Liu Han ordered Zeng Jianjun, one of his henchmen, to kill rival gang boss Zhou Zheng in Guanghan, according to the authorities.

In February 1999, Wang Yongcheng, another gang boss in Mianyang, threatened to blow up Liu Han's company building.

Days later, Wang was gunned down by a shooter allegedly sent by one of Liu Han's lackeys, Sun Huajun.

In September 2000, Liu Wei instructed his men to kill Liang Shiqi, an old neighbor whose aunt had raised Liu Han as her own, authorities said. Liu Wei allegedly ordered the killing out of a suspicion that Liang had pocketed his "dog minding fees".

In May 2002, Liu Han's bodyguards Qiu Defeng and Huan Lizhu provoked a brawl in a recreation center in Chengdu, capital of Sichuan. One person was killed and many injured.

Qiu was later sentenced to four years in prison. The other killers walked free.

Liu Han was soon established as a "kingpin" in Guanghan and Mianyang. Some of his victims were forced to leave their homes in fear of his gang.

More than 100 members of the public were made to suffer by the group, the authorities said.

In 2008, Chen Fuwei, boss of another Guanghan gang, was released from prison, threatening to take revenge on the Liu brothers. In response, Liu Wei allegedly called in Wen Xiangzhuo and Kuang Xiaoping and told them to "get rid of Chen".

The killing took place in broad daylight on Jan 10, 2009.

Afterward, Liu Han allegedly arranged for Liu Wei to escape and lobbied for his innocence. Liu Han met with his younger brother many times since then, giving him millions of yuan.

Evidence collected in the investigation show Liu Han's gang involved in dozens of serious criminal offenses, including homicides, assaults and illegal detentions, over more than 10 years. There have been at least nine deaths, five of which were the result of gunfire.

Rise to riches

Liu Han allegedly protected his business with his gang and funded his gang from his business, and thus engineered his dizzying ascent into the realm of the super-rich.

In March 1997 when Liu set up the Hanlong Group in Mianyang, he reportedly recruited hatchet men in the name of security guards. He allegedly had Liu Wei purchase weapons, and they built an underground arsenal in Guanghan.

When the gang was busted in 2013, police confiscated three grenades, 20 guns, 677 bullets, 2,163 shotgun cartridges and more than 100 knives.

Liu's syndicate was extremely hierarchical, with him being the head. Large numbers of thugs were at his disposal.

He wanted fierce fighters, and as long as they fought for the "organization", the organization covered for their crimes.

According to Liu's rules, gangsters should claim no involvement with Hanlong if caught by the police. Anyone who revealed the organization's secrets was severely punished.

Those who hesitated to kill were expelled, while murderers like Tang Xianbing were promoted to managerial positions with annual salaries of 100,000 yuan ($16,400).

After Sun Huajun and Miao Jun allegedly killed Wang Yongcheng, Liu Han arranged their escape, and rewarded Sun with a Cadillac, an Audi and more than 300,000 yuan. Miao Jun received 600,000 yuan.

With carrots and sticks, Liu established absolute authority in the gang. Blood cleared the path for his businesses. His wealth snowballed.

According to the police, after killing Zhou Zheng in 1998, Liu Han and Liu Wei monopolized gambling and loan-sharking in Guanghan. Their dominance expanded to sand extraction, construction and building material markets in and around Guanghan.

The slaughter of Xiong Wei and Wang Yongcheng helped clear the way for real estate development in Mianyang. Liu won tender for lucrative projects such as the Mianyang airport and Hanlong Bridge. He acquired the Forgood Distillery Co below market price.

In 2000, Liu moved Hanlong Group's headquarters from Mianyang to Chengdu, the provincial capital, reaching out to more sectors. When his organization zeroed in on a project, other bidders backed off.

Interviewed by The Wall Street Journal in 2010, Liu said he "has always been a winner, never lost".

Since 2000, violence played less and less a part in his gang's dealings. The fear had already been spread. Its job was done. Liu Han and his gang dominated local politics and the economy by intimidation.

Liu and his Hanlong Group meddled in and monopolized many industries. His business empire was backed by menace. Evidence shows that he and his gang have accumulated enormous wealth in property, mining, and electricity, through loan sharking and stock market manipulation, by illegal mergers and acquisitions, among other means.

They controlled more than 70 companies, including two listed ones, and four based overseas. They have swindled loans worth 4.6 billion yuan; taken shares in overseas gambling companies; and made $29.6 million by taking mainland citizens to gamble in Macao.

Liu's criminal empire has amassed nearly 40 billion yuan of assets and hundreds of cars, including Rolls-Royces, Bentleys and Ferraris.

Liu Han and his accomplices spent their illegal gains on firearms, knives and vehicles. He awarded bonuses to the lieutenants who did his evil bidding, gave them houses, money and drugs. He bought political influence and built a "protective umbrella" through bribery.

'Protective umbrella'

Alongside the Liu brothers in the dock are three former local political and legal officials: Liu Xuejun, former political commissar of the Deyang public security bureau's criminal police contingent; Lyu Bin, director of Deyang public security bureau's equipment and finance department; and Liu Zhongwei, deputy chief prosecutor of the people's procuratorate in Shifang city.

According to Liu Wei, aside from financial favors, he would also accommodate the trio at his own club where the four would do drugs and party together. In return, Liu Xuejun buried case files. Liu Xuejun also ran interference after homicides, while Liu Zhongwei and Lyu Bin provided firearms and ammunition.

The Liu brothers forged a sophisticated network of crooked officials through bribery, helping with promotions and providing drugs. Investigations were interrupted, evidence was destroyed and absurdly light penalties were dished out.

For example, in May 2003, Sun Huajun, a member of Liu Han's circle, was arrested by the police for illegal possession of firearms. He was set free 15 days after his arrest.

Liu Han became widely connected to government officials in his search for an ever-more powerful "umbrella".

"Liu Han is extremely generous when dealing with government officials. He is willing to pay, and he knows how to cater to their like," said right-hand man Sun.

"Liu Han would take me to dine with them, and offer them gifts such as gold or jade worth even millions of yuan," said Liu's ex-wife, Yang Xue. "Sometimes he would deliberately lose when gambling to bribe them."

Yang Xue is being prosecuted in a separate case.

Liu Han's connections extended even to Beijing, according to Yang and other core members of the gang.

He gained access to top-ranking officials when he was elected to the standing committee of the Sichuan provincial committee of the Chinese People's Political Consultative Conference, and spent an enormous amount trying to bribe them.

Liu and members obtained a variety of political positions. Sun, for example, was a deputy to the Sichuan provincial People's Congress.

Liu Han's powerful connections gave him a certain amount of control over local government appointments and promotions.

In 2000, he proposed a tourist project at Mount Siguniang in Xiaojin county, but the plan was rejected by Ge, a county chief. Ge was swiftly transferred away from Xiaojin, and Liu Han's project got underway.

"Liu Han has money, connections, guns and lieutenants willing to kill for him. Everyone is afraid of him. Once he is offended, you either die or lose your job," said Wen Xiangzhuo, a member of Liu's gang.

For more than 10 years, Liu Han's bloc has intimidated Sichuan society. Even now, as police investigated in Sichuan, people with inside knowledge were reluctant to talk.

During a meeting on political and legal affairs last month, President Xi Jinping ordered law enforcement officers to "carry the sword of equality and scales of justice" and to defend those principles however they could.

It took a year of painstaking investigation under the direct command of the Ministry of Public Security before the gang was broken and its key members seized.

With the case now before the courts, the truth about the real Liu Han behind the billionaire facade awaits final exposure.

Police display weapons allegedly owned by mining tycoon Liu Han (left) and his brother Liu Wei, who are alleged to have been part of a Mafia-style gang. Prosecutors in Hubei charged the Liu brothers on Thursday with crimes that include intentional homicide, injury and illegal detention. Thirty-four others also stood trial on related charges. Xinhua