Society

Shareholder of Hilton Chongqing arrested

By Wang Jingqiong (China Daily)
Updated: 2010-07-26 08:30

BEIJING - Police in Chongqing in Southwest China have arrested 46 people for their alleged involvement in a mafia-style gang - including two local government officials and a major shareholder of the Hilton Chongqing that had been shut down last month over prostitution.

Peng Zhimin, a real estate developer in Chongqing, leaves a fi ngerprint to sign for his testimony after being arrested by Chongqing police on Friday. He is charged with 13 off ences, including managing a mafi a-style organization, organizing prostitution, assault, illegal occupation of farmland and bribery. [China News Service]

The arrests - which included "no small number of women and officials", according to police - were the latest part of an ongoing crackdown against crime.

Chief among those detained on Friday night was Peng Zhimin, a real estate developer in Chongqing who faces 13 charges, including managing a mafia-style organization, bribery, prostitution, assault and the embezzlement of farmland, according to a statement from the municipal public security bureau.

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Lu Yonghe, the former Party committee secretary of a district-level agricultural, forestry and water resources bureau in Chongqing, and He Defu, the former deputy director of the same bureau, were also arrested for their roles in protecting gang members, the statement added.

The police said some shareholders and executives of the Hilton had brazenly "refused to correct their gangster behavior despite previous warnings from the police", the statement read, and have "tarnished the image of Chongqing very severely".

Peng, 47, is the boss of Qinglong Property Development, which has a 53 percent stake in the Hilton Chongqing. He had been detained last month after police closed down the Hilton on June 21 over allegations that it had provided shelter for Peng's underworld gang, which ran a prostitution ring from the hotel.

Peng, according to police, ran a basement venue in the hotel, the Diamond Dynasty Club, which was a haven for criminal activity ranging from prostitution and drug abuse to gambling and other types of gang-related activities.

He has also been charged with seeking protection from officials by offering them bribes and sex with prostitutes.

Peng, who lacks a high school education, was previously behind bars for theft in the early 1980s. In the following decades, he built a fortune through the manufacture and sale of contraband cigarettes before becoming involved in real estate in 1993.

Police added that Peng organized dozens of gang members to shake down people in certain neighborhoods of Chongqing for their land, homes and property.

On raiding the club, the police arrested 22 people the day before the hotel was shut down altogether.

Soon afterwards, hotel management issued a statement saying it was "cooperating with the police to review its security measures", adding that the club was "totally independent from the hotel".

Following a week of inspections at the hotel, authorities gave permission for the Hilton to reopen at the end of June, while the Diamond Dynasty remained shut.

Late on July 21, however, the hotel was stripped of its five-star status because of the allegations about its links to prostitution. This came after China's hotel rating authority issued a statement on July 6 saying that the hotel's actions had "seriously harmed the image of the national hotel star-ratings".

China Daily