Seven people, including a former prosecutor and two senior tax officials, were sentenced to death in China yesterday in the first convictions in the latest corruption scandal to sweep the country.
The seven face execution for their role in a tax rebate fraud extending across 11 provinces involving as much as $6 billion.
In another corruption investigation in the eastern province of Xiamen, 17 people have already been sentenced to death. The former deputy national police chief, Mr Li Jizhou, went on trial in Beijing earlier this week in relation to this case, charged with taking bribes from smugglers.
This latest case could amount to the biggest corruption case of the Communist era. The seven sentenced to death yesterday claimed export tax rebates, worth $7 million, using fake tax receipts from shell companies with no staff or premises, the official Xinhua news agency reported last night.
The verdicts are the first in the nationwide investigation into massive fraud headed by a special cabinet team.
The seven sentenced to death were named as Huang Zhenchi, Lin Sucun, Huang Wenlong, He Tao, Lin Zhenyu, Chen Hanjie and Zhou Songqing.
The court heard yesterday that Lin Zhenyu, the head of the Chaoyang tax collection office, and his deputy, Chen, allowed Huang Zhenchi to register nine firms, even though they had no capital, employees or premises.
Police had detained Mr Ji Yongzhen, former head of the Inspection Bureau of the Shanghai Customs Office, in connection with the investigation. The cabinet investigation team is also questioning tax and customs officials in six cities in Guangdong. Guangdong accounts for 37 per cent of China's exports and tax rebates rose by 85 per cent to $9 billion in the first half of 2000, according to Xinhua.
The Chinese Premier, Mr Zhu Rongji, has described the tax fraud as an "outstanding social and economic problem" and an "urgent economic struggle".