Life Sentence for Two Developers Responsible for Shanghai Building Collapse

Published: 2010-04-22

Translated by Rose Scobie
Original article:

Two corrupt property developers responsible for the collapse of a Shanghai apartment building in June last year, were both sentenced to life in prison by a Shanghai court yesterday.

Zhang Zhiqin, the general manager of Meidu Real Estate Company (Meidu), and Que Jingde, the second-largest shareholder in the same company, were sentenced by the Shanghai Municipal No. 1 Intermediate People's Court yesterday.

Both men were also chairmen of Shanghai Meilong Capital Investment Company and have been held responsible for the widely-reported collapse of the building that killed one construction worker in the early hours of June 27, 2009.

Que Jingde was found guilty of embezzlement and sentenced to life in prison and stripped of his political rights for life. Additionally, the court decided to confiscate two million yuan worth of his personal assets.

Zhang Zhiqin was found guilty of corruption and was sentenced to life in prison and was also deprived of his political rights; the court decided to confiscate five million yuan worth of his personal assets. Zhang Zhiqin was also found guilty of embezzlement and negligence.

Long History Corruption and Embezzlement

The court's investigation revealed that in December 1995, defendants Que Jingde and Zhang Zhiqin were appointed by the Shanghai Minhang District Meilong Township's property development company to high-level positions at Mei Dou. Zhang Zhiqin was appointed legal representative, board chairman, and director; Que Jingde was appointed board member and deputy director. In October 2000, Mei Dou Company hired an asset evaluation company; an evaluation was conducted involving the assessment of all their assets and liabilities.

In October 2000, the assessment firm issued a report stating that Mei Dou's assets were worth 20 million yuan. In February, 2001, the Minhang District People's Government consented that Mei Dou give 10 million yuan worth of its assets to Que Jingde, Zhang Zhiqin and its other twenty-four rightful owners. From September 2000 to February of 2001, defendants Que Jingde and Zhang Zhiqin exploited their positions during Meidou's restructuring process by methods of deceit and concealment, resulting in 42.46 million yuan of Mei Dou's assets being left unaccounted for in its asset evaluation total.

In April, 2001, after restructuring, Zhang Zhiqin managed to acquire 64 percent of the company's shares; holding the position of legal representative, board chairman, general manager, and director. Que Jingde held 15 percent of total shares. Zhang Zhiqin and Que Jingde occupied 33.7 million worth of Mei Dou's assets of which they embezzled 4.4 million yuan worth for their personal finances.

The court's investigation found, from March to June 2009, defendant Zhang Zhiqin used his positions in Mei Dou to sell apartments in Mei Dou's Lotus Riverside development for a total of 440 million yuan. With these funds he purchased wealth management products from financial institutions through his personal bank accounts or company accounts. In April, 2009, defendant Zhang Zhiqin deposited 25 million yuan into Mei Dou's Company bank account. The audit conducted by Shanghai's Judicial Accounting found, Zhang Zhiqin embezzled 440 million yuan of funds from Mei Dou and used them to earn a net income of 2 million yuan from interest and investment profits. After the investigation, the administrative group responsible for the Lotus Riverside development recovered 415 million yuan of Mei Dou's funds; a majority of the profits.

Building Collapse Caused by Illegal Underground Garage Excavation

The court investigation found, in August 2006, the construction of Mei Dou's residence compound Lotus Riverside was handed over to Shanghai Zhongxin Company and the development's engineering was commissioned to Guang Qi Company. Later that year in October, Mei Dou acquired the necessary permit for construction and began building. Defendant Zhang Zhiqun was in charge of the Lotus Riverside development.

The court determined, from November 2008 to June 2009, Zhang Zhiqun appointed an unqualified subcontractor, Zhang Yaofen, to excavate the land required to build an underground garage. The subcontractor ordered that the excavated land be piled on the north side of the development's building number 7; the pile reached up to ten meters. At 5 am June 27, 2009, building number 7 of the Lotus Riverside development fell over completely in tact, crushing to death a construction worker.

At 5 am on June 27, 2009, due to the excessive height of the pile of dirt located behind the building number 7, coupled with the excavation taking place of an underground garage on the south side of the building, the pressure on both sides surpassed the amount foundation of the building could withstand and the entire building fell over.

Six Others Punished

The other six people responsible for the building collapse were handed prison sentences of between three to five years last February. Yesterday, Shanghai Municipal No. 1 Intermediate People's Court rejected the appeal of three of the six and the court's original verdict was upheld.

Links and Sources
Xinmin Daily:上海倒楼案两人被判无期 (Chinese)