Guizhou official gets life term in blood-bank scheme

(Shanghai Daily)
Updated: 2009-01-22 14:12

A former blood bank operator in southwest China's Guizhou Province has been sentenced to life in prison for the embezzlement and misuse of nearly 100 million yuan (US$14.5 million) in public funds.

He was also found guilty of paying bribes to public officials for protection and dodging taxes.

The defendant, Chen Dengfu, was head of the blood bank in Guizhou's Zhenyuan County and also vice director of Zhenyuan's health bureau. He did so well in the scheme that he had personal assets of more than 10 million yuan and drove a BMW and a Porsche, according to a report in Guizhou Metropolis Daily.

But Chen's fortunes began to dim in 2006 when reporters alleged he was making illegal profits from the public blood bank and had invested 21 million yuan to open a real estate company in the provincial capital, Guiyang.

Based on the news reports, Guizhou Party Secretary Shi Zongyuan ordered an investigation into Chen's activities, headed by the provincial anti-corruption bureau.

Prosecutors and police seized Chen on July 15, 2006. The blood bank's accountant fled after learning of the probe.

Chen at first admitted he had bribed senior officials, including Zhenyuan Party Secretary Huang Baoqin, but then retracted the confession.

His brother hired lawyers to argue that the blood bank was privately owned by Chen and even showed Zhenyuan government documents backing the claim. Those papers were allegedly the result of bribes Chen paid Huang.

But prosecutors determined the facility was set up as a government agency in the 1990s using Zhenyuan public funds.

Chen earned illicit income by selling donated blood to biochemical and pharmaceutical companies across the nation and having them send most of the payments to two of his own companies, according to the newspaper report.

Before the blood bank was "privatized," Chen embezzled 21 million from the facility and forced it to borrow 6 million yuan from two of his companies, the report said. He also allegedly pocketed 73 million yuan after taking over the facility.

Huang was later sacked and placed under investigation over the graft allegations.