Software Income

China’s efforts to eradicate organized crime cast a shadow over private companies

Chinese leader Xi Jinping’s efforts to crush organized crime have led to lawsuits and asset seizures targeting high-profile entrepreneurs and sent private companies in the world’s second-largest economy shivering.

The campaign fell heavily on people like Zhang Wei, who started lending, asset management and real estate investment businesses in the southern city of Shenzhen, where he also became a city lawmaker.

Police accused him of running a “underworld-type” crime syndicate that engaged in fraud, blackmail and other offenses. In May, a Shenzhen court sentenced Mr. Zhang to life in prison and confiscated property, including property, stocks and an Airbus A319 plane, which his family estimated at more than $ 1 billion.

Mr. Zhang admitted to giving bribes and asking associates to enter a private residence, but denied all other charges against him. His lawyers and family said his alleged wrongdoing did not meet the government’s definitions of “underworld” crimes and that his sentence was grossly disproportionate. Mr. Zhang could not be reached for further comment.

The case against Mr. Zhang and the like has alarmed some entrepreneurs and legal experts, who say the Communist Party’s zealous enforcement threatens to undermine the private sector.

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